Amid the backdrop of COVID-19, the Russia-Ukraine crisis, and the Fed’s interest rate hike, many countries economies are collapsing. At present, in addition to the worsening food crisis, in the plight of high global inflation, the Federal Reserve continued to raise interest rates, but also pushed up the cost of us dollar financing, to emerging economies brought great debt repayment pressure, some countries are collapsing economy.
These countries generally have several common characteristics: single industrial structure, foreign exchange earning capacity mainly depends on low value-added products, large trade deficit, dependence on foreign capital, poor risk resistance ability and so on. Here to remind: export enterprises, be sure to pay attention to foreign exchange risk, to avoid unnecessary losses.
Pakistan: Collapsing economy, scarce foreign reserves, rising inflation, plunging currency! Pakistan is facing falling foreign exchange reserves, a widening current account deficit, rising inflation and a plunging currency.
Lebanon’s government is bankrupt and its economic crisis continues! In recent years, Lebanon has suffered from a sluggish economy, high public debt and high unemployment. The COVID-19 pandemic and the bombing of Beirut’s port in August 2020 have added to Lebanon’s economic woes.
Sri Lanka is in a serious economic crisis and may be the first emerging market country to crash! Sri Lanka faces its worst economic crisis since independence in 1948, defaulting on its sovereign debt for the first time, shrinking foreign exchange reserves and teething on the brink of bankruptcy, shortages of daily necessities and medicine, and intermittent power cuts that triggered more than a month of anti-government protests and prompted The resignation of Mahinda Rajapaksa as prime minister. But the root causes of the demonstrations remain unresolved.
Mongolia’s foreign exchange reserve shortage, banks temporarily deal with the us dollar, euro business! Earlier, the Asian Development Bank (ADB) said in its 2022 Asian Development Outlook that Mongolia’s economy is in a crisis state due to three consecutive quarters of negative growth.
These fragile market countries with high foreign debt and low foreign reserves face the dilemma of dollar capital withdrawal. According to the international monetary fund and world bank and other institutions of comprehensive data, Argentina, Brazil, Pakistan, Turkey, Sri Lanka, Malaysia, Egypt, Indonesia, Mexico, Lebanon, Nepal, India, Vietnam, myanmar, Mongolia, Thailand, Peru, or at least 17 countries have a dollar debt trap, due to debt, And do not have a strong foreign exchange reserves to support the plight of the new dollar monetary tightening cycle.
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Have a good luck.
Post time: Jun-07-2022