Default risks easing, but simmering fiscal problems in some EMs
The incidence of sovereign debt distress has declined sharply across the EM world and is now back to pre-pandemic levels. But our EM Financial Risk Indicators suggest that several countries are still vulnerable to acute debt problems. We also remain concerned about slow-burning fiscal problems in a few larger EMs, not just the usual suspects (Brazil and South Africa), but also Colombia and parts of Central and Eastern Europe.
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