10 Mai 2010
Top 10 countries with the highest default risk
The list of countries with the highest default risk changed in the last month, with some euro countries joining the top.
10. Spain
At the end of last year, Spain’s CDS was at 113.5 basis points, which points to an increase in default risk to 83.7%.
In the first quarter this year, Spain’s jobless rate climbed to a record 20.5%, the highest in the 16-nation euro area. In fourth quarter 2009, Spain’s economy fell 0.1%.
In the list compiled by CMA Data Vision in April, Spain was not in the top 10 list of countries with the highest default rate.
9. Bulgaria
Year-to-date, CDS prices dropped 4%.
The Bulgarian government adopted a set of austerity measures aimed at bringing public finances on the mend and cut expenditures, as state revenues fell short of estimates since the beginning of the year.
The nation’s budget deficit came in at 3.7% at the end of the trailing year, overshooting the 1.9% deficit target.
8. Vietnam
At the end of last year, Vietnam CDS was at 231.1 basis points.
7. Lebanon
The nation CDS grew 7.3% from 274.8 basis points at the end of 2009.
In the April list compiled by CMA Vision, Lebanon was not included in top 10 countries with the highest default risk.
6. Portugal
On May 4, Portugal CDS was at 355.4 basis points, from only 91.7% at the end of 2009.
Fitch Ratings downgraded Portugal’s long-term foreign and local currency credit ratings from ‘AA’ to ‘AA-‘ citing significant fiscal shock and structural macroeconomic weakness.
Portugal’s CDS rose sharply at the end of April, after Greece’s ratings were cut to junk.
5. Iceland
In early April, Moody’s Ratings cut Iceland’s outlook from ‘stable’ to ‘negative’, as uncertainty surrounding the country's ability to borrow abroad mounts amid the ongoing Icesave bank dispute.
Last year, the country’s GDP contracted by 6.5%, the biggest ever economic contraction recorded by Iceland.
4. Dubai
Dubai’s debt problems sent shockwaves across all markets around the world, and caused a sharp depreciation of Islamic bonds, after saying it would default on a part of its debt.
3. Greece
After a round of talks, euro area countries and the International Monetary Fund agreed on a €110 billion bailout package for the country.
2. Argentina
At the end of last year, Argentina CDS was at 915.9 basis points, 5.4% higher than now.
The Government in Argentina denied the country was in recession last year, despite the private sector’s estimates of a 4% economic contraction in 2009.
1. Venezuela
Year-to-date, the country recorded the biggest decline in CDS prices, namely 14.8%.
Venezuela is facing a high inflation rate that came in at 25% at the end of 2009.