Economia Globale

Countries most indebted and at risk, the updated ranking

Which are the most indebted and at-risk countries, according to an updated world ranking? And, above all, where does Italy fit in? Our country is not well positioned when compared to other large European economies and the G7 group.
In the map updated to 2023 of the nations most at risk with regards to investments and the possibility of default, therefore of having an unsustainable level of debt, it is interesting to note that the analyst who curates the report, Aswath Damodaran of the Stern School of Business of New York University, study some key factors before making the list.
Precisely on the basis of these parameters, the framework of stability, credibility, growth prospects and level of geopolitical tension in which a given State fits into emerges.
The economic, financial and political dimensions are obviously all three fundamental in determining the level of risk.
In the ranking of the most indebted and at-risk countries, where is Italy? What you need to know with the 2023 update.
Which countries are most indebted and at risk? The ranking How is country risk calculated and what factors should be considered to draw up the ranking of the worst and best nations in terms of financial stability and confidence? Professor Aswath Damodaran has identified a method that allows you to evaluate 3 factors, plus one addition.
Specifically, they are assessed, as stated in the official explanation: Political risk: type of regime, corruption, level of conflict Legal risk: Protection of property rights, contractual rights Economic risk: diversification of the economy In addition, the risk default, or the unsustainability of a State's debt, which therefore is unable to fulfill its payment obligations.
“When a nation defaults on its debt, this often leads to market turbulence and other negative effects that can last for many years,” we read in the note, demonstrating a very important condition in evaluating the risk conditions of a nation.
By adding these elements, the ranking of the most indebted and at-risk countries in 2023 sees the top 10 places.
The percentage refers to the risk coefficient): Belarus: 24.8% Lebanon: 24.8% Venezuela: 24.8% Sudan: 24, 8% Syria: 24.8% Argentina: 18.2% Cuba: 18.2% Ghana: 18.2% Russia: 18.2% Sri Lanka: 18.2% Ukraine: 18.2% It is also interesting to note the ranking the opposite: which are the nations with less risk and more reliable? At the bottom of the list are Germany, Liechtenstein, Luxembourg, Holland, New Zealand, Norway, Singapore, Sweden, Switzerland, the United States, all with a risk coefficient of 0%.
How much is Italy at risk? Italy is not a 0 risk country according to this ranking and, bearing in mind some chronic critical issues of our nation, the result is not surprising.
What, then, is the Italian risk coefficient? According to Aswath Damodaran's parameters it is 3.3%.
A not exciting number if you consider that our country is a member of the G7 and considered the third largest economy in the EU.
read also Piazza Affari can collapse and the reason is the debt (according to Goldman Sachs) Keeping Italy company with the same risk coefficient are nations such as India and Romania and Colombia, Croatia, Hungary are better placed than us , Mexico, Libya, Spain, Portugal, Botswana, Chile (just to name a few).
Even considering the intersection of different aspects and characteristics of each country, what emerges is perhaps the confirmation that some of Italy's chronic problems continue to penalize it.
The high debt, the inefficiency of the use of funds, including European ones, corruption, tax evasion, bureaucratic obstacles and slow justice are increasingly weakening Italy on a global level.
The Pnrr should be the turning point to change the trajectory.
But the road appears long and uphill.

Author: Hermes A.I.

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