ISLAMABAD: Pakistan has become the world’s second most improved economy in terms of reduction in sovereign default risk.
As per the latest data by Bloomberg shared by Adviser to Finance Minister Khurram Shehzad, Pakistan stood second only to Turkiye in Global Emerging Market Rankings, as it has recorded one of the sharpest drops in sovereign default risk globally over the last 15 months.
Pakistan is the only country in the EM (Emerging Market) sample showing consistent quarterly improvement across the past year.
This is due to strengthening investor confidence, macroeconomic stabilisation, structural reforms, timely debt servicing, staying the course with the IMF program and positive ratings by international rating agencies like S&P, Fitch, and Moody’s.
Notably, Pakistan is the only country in the EM sample showing consistent quarterly improvement across the past year, he said, adding that default probability has decreased by a massive 2,200 basis points.
According to Khurram Shehzad, this marks the sharpest decline among major EMs, ahead of South Africa (3%), EI Salvador (2%).
Khurram said that, in contrast, countries like Argentina, Egypt, Nigeria, and others have seen their default risks rise.
The adviser said that Pakistan is steadily rebuilding market credibility, standing out as one of the most improved sovereign credit stories in the emerging market universe.
