External debt stocks (% of GNI)
Countries By External debt stocks (% of GNI)
Key points
- Total external debt stocks as a percentage of Gross National Income (GNI) provide insights into a country's debt sustainability and its ability to repay debts owed to nonresidents.
- Mozambique stands out with the highest percentage of external debt stocks to GNI at 434.52%, highlighting potential high financial risk and dependency on external financing.
- Conversely, Iran has the lowest external debt stocks to GNI ratio at 2.27%, indicating a lower level of indebtedness and potentially greater financial stability.
- The average external debt stocks to GNI ratio across the selected countries is 65.42%, suggesting a moderate level of external debt burden relative to the size of national economies.
- Countries with ratios significantly above the average, such as Lebanon, Mongolia, and Montenegro, may face greater challenges in managing their external debt and ensuring sustainable economic growth.
Official Definition of External debt stocks (% of GNI)
Total external debt stocks to gross national income. Total external debt is debt owed to nonresidents repayable in currency, goods, or services. Total external debt is the sum of public, publicly guaranteed, and private nonguaranteed long-term debt, use of IMF credit, and short-term debt. Short-term debt includes all debt having an original maturity of one year or less and interest in arrears on long-term debt. GNI (formerly GNP) is the sum of value added by all resident producers plus any product taxes (less subsidies) not included in the valuation of output plus net receipts of primary income (compensation of employees and property income) from abroad.
Importance
The External debt stocks (% of GNI) is a crucial macroeconomic indicator for countries as it reveals the extent of total external debt in relation to their Gross National Income (GNI). A low value of this statistic generally indicates that the country has a lower dependency on external borrowing for financing its activities. This can be advantageous as it signifies a lower risk of debt distress and financial instability. Countries with low external debt stocks are often viewed more favorably by creditors and investors, allowing them to access capital at more favorable terms.
Conversely, a high value of External debt stocks (% of GNI) can be a cause for concern as it implies a heavy reliance on external borrowing. High levels of external debt can lead to various challenges such as increased vulnerability to external shocks, currency depreciation, and higher debt servicing costs. Countries with high external debt stocks may find themselves constrained in their ability to invest in domestic development projects and may face difficulties in meeting their debt obligations.
In conclusion, monitoring the External debt stocks (% of GNI) is essential for policymakers as it provides insights into a country's debt sustainability and financial health. Striking a balance between utilizing external financing for growth while managing associated risks is crucial for long-term economic stability and development.
Top 10 Countries by External debt stocks (% of GNI)
Bottom 10 Countries by External debt stocks (% of GNI)
Regions
Europe
Among the listed countries, Montenegro stands out with the highest External Debt Stocks at 195.39% of GNI, indicating a potentially risky level of debt exposure. Ukraine follows with 82.74%, while Serbia, Albania, and Belarus have moderately high levels ranging from 70-74%. Romania, Bosnia and Herzegovina, Bulgaria, and Moldova have lower but still sizable percentages. The Russian Federation demonstrates relatively lower external debt at 31.61%. High levels of external debt can provide access to necessary funds for development but also pose risks of debt distress and dependency on creditors. Lower levels suggest a more stable financial position but may limit opportunities for growth through investments. Each country's ability to manage and service their external debt will impact their development trajectory significantly.
Far East: East Asia, SE Asia, Australia
The statistic on External debt stocks (% of GNI) reveals varying levels of external debt as a percentage of Gross National Income among the selected countries. Mongolia stands out with the highest percentage at 268.48%, indicating a significant reliance on external borrowing. Laos follows at 114.85%, also showing a substantial debt burden. On the other hand, China has a relatively lower percentage at 15.97%. High external debt can pose risks such as vulnerability to economic shocks and limited fiscal space for development projects; however, it can also fund necessary investments. Countries like Cambodia, Myanmar, and the Philippines fall within moderate ranges, hinting at balanced debt levels. Each country's ability to manage and service this debt will impact their economic stability and growth prospects differently.
ASEAN
Among the listed countries, Laos has the highest external debt stock as a percentage of GNI at 114.85%, indicating a high level of indebtedness to nonresidents. Cambodia follows with 70.87%, while Myanmar has the lowest at 17.29%. This statistic suggests that Laos and Cambodia may face challenges in managing their external debt burdens, potentially affecting their economic stability. In contrast, Myanmar's lower percentage implies a relatively lower risk of debt distress. High external debt can constrain economic growth due to debt repayment obligations, while low debt levels can signify stronger financial health. Each country must carefully manage their debt to avoid economic vulnerabilities and sustain long-term development.
Latin America
The statistic of External Debt Stocks (% of GNI) reveals significant disparities among the listed countries. Panama stands out with a notably high percentage of 199.08%, indicating a heavy reliance on external borrowing, which could potentially pose risks to its financial stability. Nicaragua follows closely behind with 116.08%, signaling a similar vulnerability. On the other hand, Guatemala has the lowest percentage at 32.52%, suggesting a more sustainable debt level. High levels of external debt, such as in Panama and Nicaragua, may offer short-term financial flexibility but could lead to long-term challenges in debt repayment, economic stability, and dependency on foreign creditors. In contrast, countries with lower percentages like Guatemala may enjoy more financial autonomy and stability but could face limitations in funding for development projects.
Middle East
When examining the External debt stocks (% of GNI) for the selected countries, significant disparities emerge. Lebanon stands out with a staggering value of 224.36%, indicating a heavy reliance on external borrowing, which could potentially lead to vulnerability in times of economic stress. Georgia follows with 133.00%, showcasing a similar trend of high external debt. Armenia, Jordan, and Tunisia also demonstrate elevated levels above 80%, reflecting a reliance on external financing. In contrast, Iran and Algeria have notably lower percentages, suggesting a lower dependency on external debt. This statistic implies that while certain countries may benefit from access to capital for development, high levels of external debt pose risks to economic stability and could hinder long-term growth prospects.
Rivals
Russia v Ukraine
Among the selected countries, Ukraine has a significantly higher External debt stocks (% of GNI) at 82.74% compared to the Russian Federation at 31.61%. This indicates that Ukraine is more leveraged in terms of external debt compared to its gross national income. The advantages for Ukraine could be access to much needed capital for development, but the disadvantage lies in the higher risk due to the dependency on external creditors. For the Russian Federation, the lower percentage signifies a comparatively healthier financial position with less reliance on external borrowing. However, this could also indicate a potential lack of investment for growth. Overall, a high external debt stock can impact economic stability, currency valuation, and future borrowing capacity for these countries.
India v Pakistan
India has an external debt stocks of 21.44% of its Gross National Income (GNI), while Pakistan's stands at 40.02%. India's lower percentage indicates a lower reliance on external borrowing compared to Pakistan, suggesting more robust financial stability. However, a disadvantage for India could be less access to potential investment opportunities that foreign borrowing could provide. On the other hand, while Pakistan may have easier access to funds for development, the high percentage poses a risk of debt distress or economic vulnerability. This statistic underscores the importance of prudent debt management for both countries, influencing their economic development trajectories significantly.
FAQs
-
Which country has the most External debt stocks (% of GNI)?
Answer: Mozambique has the highest External debt stocks relative to Gross National Income, at 434.52%. -
Which country has the least External debt stocks (% of GNI)?
Answer: Iran has the lowest External debt stocks relative to Gross National Income, at 2.27%. -
What is the average External debt stocks (% of GNI) among the listed countries?
Answer: The average External debt stocks as a percentage of Gross National Income across all listed countries is approximately 65.42%.