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- As the global interest rate cycle turns, we expect emerging markets (EM) EMEA will modestly increase its gross long-term commercial borrowing in 2023, likely to $434.9 billion for the year.
- U.S. monetary policy shifts remain a key risk to EM funding conditions, as does related currency volatility.
- EMEA EM sovereigns' commercial debt stock should reach $2.9 trillion equivalent (36.1% of GDP) by end-2023, a record in dollar terms but still below the pandemic-era peak of 43.4% in GDP terms.
- Egypt will likely remain the largest EMEA EM sovereign issuer of commercial debt, with Turkiye not far behind.
Following one of the weakest years for issuance in recent times, we anticipate a modest increase in commercial borrowing by emerging markets (EM) sovereigns in Europe, Middle East, and Africa (EMEA). Aggressive monetary tightening by the U.S. Fed and a strengthening dollar throughout 2022 saw a drop in estimated EM EMEA sovereign commercial issuance of almost one-fifth compared to 2021. As interest rates start to level off toward the end of 2023, however, we project a modest increase in issuance. This is not least because fiscal gaps are still elevated in much of the region and high local currency and foreign-exchange yields remain selectively attractive to a cash-rich investor base. We expect total commercial debt stock to rise to $2.9 trillion equivalent, which is about $45 million higher than last year's record. More so than recently, our projections are subject to notable uncertainties connected to U.S. monetary policy, the strength of the U.S. dollar, and macroeconomic fundamentals in EM EMEA.
S&P Global Ratings projects EM EMEA sovereigns' end-2023 commercial debt will be 36.1% of combined GDP, about the same as end-2022. This reflects net commercial debt issuance broadly keeping pace with nominal GDP growth at least on average. Underlying the mixed picture for commercial borrowing in the region are some key themes for 2023:
- Higher rated energy-importing EM sovereigns to increase issuance in 2023. This includes the central governments of Poland, Israel, and Morocco. Given comfortable market access, limited eligibility for concessional borrowing, and elevated fiscal needs these sovereigns are each expected to issue over $9 billion more in long-term commercial debt compared to 2022.
- Recently defaulted sovereigns to face a credit crunch. Specifically, we expect a significant drop-off in issuance from Ukraine and Ghana, by $17 billion and $7 billion respectively. We expect Ghana to remain out of commercial markets, except domestic Treasury bills, for at least the remainder of 2023.
- Oil exporters' issuance to be modest. While S&P Global Ratings assumes oil prices will fall somewhat from the heights of 2022, fiscal balances are generally expected to remain healthy for EMEA's hydrocarbon exporters, which should limit the need of sovereigns such as Saudi Arabia, Qatar, Kuwait, Kazakhstan, Iraq, and Oman to issue more aggressively.
Of the 55 EMEA EM sovereigns in this survey, the commercial debt levels of nine have more than doubled in dollar terms since 2017: Sharjah, Uganda, Abu Dhabi, Botswana, Saudi Arabia, Zambia, Rwanda, and Oman. Sub-Saharan African sovereign commercial debt levels (excluding South Africa), while very much on the rise, only make up 12% of total sovereign commercial debt in dollar terms in EM EMEA (whereas they represent about two-fifths of the region's sovereigns). This reflects their reliance, in many cases, on concessional (non-commercial) sources of financing. Commercial debt outstanding exceeds $40 billion in only four sub-Saharan African sovereigns: Angola, Nigeria, Kenya, and South Africa. At the other end of the scale, we project the five largest EMEA EM issuers together will account for just over half of gross commercial borrowing for 2023 in dollar terms: Egypt, Turkiye, Poland, Israel, and Romania. Romania and Turkiye have already tapped foreign currency commercial markets this year in January (and Turkiye again in March).
Table 1
| Sovereign Commercial Issuance And Debt | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | ||||||||||
| (Bil. USD) | ||||||||||||||||
| Gross long-term commercial borrowing | 420.6 | 364.8 | 413.3 | 615.1 | 515.0 | 416.1 | 437.2 | |||||||||
| Of which amortization of maturing long-term debt | 201.2 | 186.0 | 217.7 | 254.8 | 256.4 | 283.2 | 273.9 | |||||||||
| Of which net long-term commercial borrowing | 219.4 | 175.4 | 195.7 | 360.3 | 258.6 | 132.9 | 163.3 | |||||||||
| Total commercial debt stock (year end) | 2,144.5 | 2,160.5 | 2,371.2 | 2,735.9 | 2,862.7 | 2,844.5 | 2,889.6 | |||||||||
| Of which short-term debt | 234.4 | 246.4 | 288.8 | 312.2 | 271.2 | 296.0 | 284.0 | |||||||||
| Of which debt with original maturity greater than one year | 1,910.1 | 1,914.1 | 2,082.5 | 2,423.7 | 2,591.5 | 2,548.6 | 2,605.6 | |||||||||
| (% GDP) | ||||||||||||||||
| Gross long-term commercial borrowing (% GDP) | 6.9 | 5.6 | 6.2 | 9.8 | 7.0 | 5.3 | 5.5 | |||||||||
| Of which amortization of maturing long-term debt (% GDP) | 3.3 | 2.8 | 3.3 | 4.0 | 3.5 | 3.6 | 3.4 | |||||||||
| Of which net long-term commercial borrowing (% GDP) | 3.6 | 2.7 | 2.9 | 5.7 | 3.5 | 1.7 | 2.0 | |||||||||
| Total commecial debt stock (year end) (% GDP) | 35.2 | 33.1 | 35.5 | 43.4 | 39.0 | 36.0 | 36.1 | |||||||||
| Of which short-term debt (% GDP) | 3.8 | 3.8 | 4.3 | 4.9 | 3.7 | 3.8 | 3.5 | |||||||||
| Of which debt with original maturity greater than one year (% GDP) | 31.3 | 29.3 | 31.1 | 38.4 | 35.3 | 32.3 | 32.5 | |||||||||
| f--Forecast | ||||||||||||||||
We forecast that just over 41% of commercial sovereign debt in 2023 will be issued by sovereigns with an investment-grade ('BBB-' or higher) foreign-currency rating (see the lower part of table 2). This is slightly higher than our estimate for 2022 (where 38% of debt is assumed to have been issued by investment-grade rated issuers). This reflects the aforementioned trend of increased issuance by higher rated sovereigns, mitigated by the expected collapse in issuance by recent defaulters. Sovereigns currently in default are at a record high.
Sovereigns within the 'B' category will remain the most active--issuing about 43% of EM EMEA commercial sovereign debt. In this category, Egypt and Turkiye will together likely account for two-thirds of such issuance.
Egypt will remain the largest EMEA EM sovereign issuer for 2023, as it has been since 2020 when Israel, Turkiye, and Saudi Arabia were each more significant commercial borrowers. Subsequent energy and food shocks have placed significant pressure on Egypt's government finances, albeit somewhat mitigated by the high (about 70%) domestic and local currency share of outstanding debt. We project Egypt will issue about $63 billion equivalent, roughly the same as last year in dollar terms, despite the significant exchange rate devaluation since October 2022. We also expect Egypt's amortizing debt coming due in 2023 to double compared to last year in local currency terms.
Including short-term debt Egypt also faces the highest rollover rate of all 55 EMEA EM sovereigns. We estimate it at 33.4% of GDP, followed by Bahrain (22.1%) and Albania (19.4%). Such levels imply these governments will remain particularly sensitive to the shifting costs of external refinancing that hinge on the Fed's monetary tightening or loosening.
Chart 2
Table 2
| Gross Commercial Long-Term Borrowing | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Bil. $ | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | Share of 2023f total borrowing (%) | Total commercial borrowing 2023f | |||||||||||
Abu Dhabi | 10.0 | 0.0 | 13.9 | 15.0 | 6.0 | 5.3 | 6.4 | 1.5 | 437.2 | |||||||||||
Albania | 0.9 | 1.5 | 0.9 | 1.9 | 2.0 | 1.0 | 1.6 | 0.4 | ||||||||||||
Angola | 23.0 | 25.6 | 27.4 | 5.5 | 4.9 | 10.1 | 10.2 | 2.3 | ||||||||||||
Armenia | 0.7 | 1.4 | 0.7 | 0.9 | 0.2 | |||||||||||||||
Azerbaijan | 2.9 | 0.0 | 0.1 | 0.8 | 0.7 | 0.8 | 0.7 | 0.2 | ||||||||||||
Bahrain | 6.3 | 2.8 | 3.3 | 7.3 | 8.9 | 4.0 | 4.6 | 1.1 | ||||||||||||
Belarus | 2.0 | 1.2 | 0.9 | 2.1 | 1.3 | 0.6 | 0.4 | 0.1 | ||||||||||||
Benin | 1.0 | 0.4 | 0.7 | 1.4 | 1.8 | 1.7 | 1.5 | 0.3 | ||||||||||||
Bosnia and Herzegovina | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Botswana | 0.2 | 0.1 | 0.4 | 0.5 | 0.2 | 0.3 | 0.4 | 0.1 | ||||||||||||
Bulgaria | 0.5 | 0.0 | 0.6 | 3.5 | 2.3 | 3.6 | 4.2 | 1.0 | ||||||||||||
Burkina Faso | 0.2 | 0.7 | 0.7 | 1.5 | 2.3 | 2.8 | 2.3 | 0.5 | ||||||||||||
Cameroon | 0.7 | 0.4 | 1.6 | 0.8 | 1.9 | 1.9 | 1.5 | 0.3 | ||||||||||||
Cape Verde | 0.1 | 0.1 | 0.0 | 0.1 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Congo, D.R. | 0.0 | 0.0 | 0.1 | 0.2 | 0.3 | 0.6 | 0.7 | 0.2 | ||||||||||||
Congo-Brazzaville | 0.2 | 0.1 | 0.2 | 0.2 | 0.5 | 1.9 | 0.5 | 0.1 | ||||||||||||
Cote d'Ivoire | 4.0 | 3.6 | 2.4 | 2.7 | 0.6 | |||||||||||||||
Croatia | 6.1 | 3.7 | 5.1 | 8.4 | 5.0 | 4.7 | 5.6 | 1.3 | ||||||||||||
Egypt | 33.6 | 38.1 | 45.4 | 56.5 | 63.0 | 60.9 | 63.0 | 14.4 | ||||||||||||
Ethiopia | 3.2 | 1.1 | 1.2 | 2.4 | 4.6 | 5.8 | 8.7 | 2.0 | ||||||||||||
Georgia | 0.2 | 0.1 | 0.5 | 0.8 | 0.8 | 0.8 | 0.9 | 0.2 | ||||||||||||
Ghana | 4.8 | 4.9 | 6.3 | 13.7 | 17.8 | 11.7 | 4.6 | 1.1 | ||||||||||||
Hungary | 17.0 | 17.9 | 26.7 | 38.4 | 32.6 | 30.4 | 25.5 | 5.8 | ||||||||||||
Iraq | 6.3 | 0.3 | 10.2 | 24.7 | 8.3 | 6.9 | 7.6 | 1.7 | ||||||||||||
Israel | 28.5 | 27.9 | 34.9 | 77.1 | 51.3 | 18.9 | 28.2 | 6.4 | ||||||||||||
Jordan | 7.5 | 5.3 | 6.9 | 6.5 | 6.2 | 6.7 | 7.0 | 1.6 | ||||||||||||
Kazakhstan | 5.0 | 3.4 | 4.8 | 7.5 | 6.1 | 8.7 | 9.7 | 2.2 | ||||||||||||
Kenya | 6.3 | 3.3 | 2.8 | 2.5 | 7.5 | 7.0 | 7.7 | 1.8 | ||||||||||||
Kuwait | 14.8 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Lebanon | 15.7 | 18.6 | 11.0 | 1.6 | 0.5 | 0.3 | 0.2 | 0.0 | ||||||||||||
Madagascar | 0.0 | 0.1 | 0.1 | 0.0 | ||||||||||||||||
Montenegro | 0.3 | 0.9 | 0.9 | 1.3 | 0.0 | 0.1 | 0.5 | 0.1 | ||||||||||||
Morocco | 11.4 | 13.0 | 11.3 | 15.6 | 15.2 | 9.0 | 18.2 | 4.2 | ||||||||||||
Mozambique | 0.5 | 0.7 | 0.3 | 3.0 | 1.9 | 1.9 | 1.9 | 0.4 | ||||||||||||
Nigeria | 10.7 | 37.2 | 11.0 | 15.4 | 15.7 | 10.2 | 14.8 | 3.4 | ||||||||||||
North Macedonia | 0.4 | 1.0 | 0.3 | 1.3 | 1.3 | 0.4 | 1.3 | 0.3 | ||||||||||||
Oman | 10.5 | 8.0 | 5.0 | 8.7 | 6.9 | 4.4 | 4.9 | 1.1 | ||||||||||||
Poland | 32.9 | 33.8 | 35.9 | 48.0 | 34.3 | 36.2 | 45.5 | 10.4 | ||||||||||||
Qatar | 19.5 | 0.0 | 21.2 | 24.1 | 24.5 | 0.0 | 0.0 | 0.0 | ||||||||||||
Ras Al Khaimah | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Romania | 12.3 | 16.8 | 18.8 | 32.7 | 23.5 | 24.0 | 26.5 | 6.1 | ||||||||||||
Rwanda | 0.0 | 0.1 | 0.1 | 0.1 | 0.8 | 0.9 | 1.0 | 0.2 | ||||||||||||
Saudi Arabia | 37.1 | 32.9 | 12.0 | 56.9 | 42.0 | 24.8 | 23.7 | 5.4 | ||||||||||||
Senegal | 1.3 | 0.8 | 0.1 | 0.3 | 0.5 | 0.7 | 0.7 | 0.2 | ||||||||||||
Serbia | 3.4 | 2.9 | 5.0 | 6.7 | 5.4 | 2.5 | 3.7 | 0.9 | ||||||||||||
Sharjah | 1.6 | 3.2 | 3.3 | 3.3 | 4.6 | 3.0 | 3.7 | 0.8 | ||||||||||||
South Africa | 17.5 | 15.7 | 21.5 | 32.3 | 19.6 | 21.2 | 16.3 | 3.7 | ||||||||||||
St. Helena | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||||||||
Tajikistan | 0.7 | 0.0 | 0.0 | 0.1 | 0.1 | 0.2 | 0.1 | 0.0 | ||||||||||||
Togo | 0.2 | 0.1 | 1.0 | 1.2 | 0.9 | 0.8 | 0.2 | |||||||||||||
Turkiye | 44.8 | 32.6 | 45.3 | 62.4 | 55.6 | 51.6 | 59.2 | 13.5 | ||||||||||||
Uganda | 0.2 | 0.7 | 1.1 | 1.5 | 2.8 | 2.6 | 2.3 | 0.5 | ||||||||||||
Ukraine | 16.4 | 4.6 | 10.8 | 11.7 | 14.1 | 17.7 | 0.4 | 0.1 | ||||||||||||
Uzbekistan | 1.2 | 0.7 | 1.0 | 0.4 | 0.7 | 0.2 | ||||||||||||||
Zambia | 2.0 | 2.0 | 1.5 | 2.5 | 2.0 | 2.9 | 3.3 | 0.8 | ||||||||||||
| Breakdown by foreign currency rating category* | ||||||||||||||||||||
| Bil. $ | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | Share of 2023f total borrowing (%) | Total commercial borrowing 2023f | |||||||||||
| AAA | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 437.2 | |||||||||||
| AA | 58.0 | 27.9 | 70.1 | 116.2 | 81.7 | 24.1 | 34.5 | 7.9 | ||||||||||||
| A | 84.8 | 66.7 | 47.9 | 105.0 | 76.3 | 60.9 | 69.3 | 15.8 | ||||||||||||
| BBB | 42.7 | 45.2 | 59.5 | 94.3 | 74.2 | 74.7 | 75.7 | 17.3 | ||||||||||||
| BB | 46.2 | 40.9 | 44.9 | 70.9 | 54.5 | 41.9 | 49.4 | 11.3 | ||||||||||||
| B | 143.9 | 150.2 | 158.1 | 190.0 | 183.1 | 168.6 | 185.9 | 42.5 | ||||||||||||
| CCC | 20.4 | 7.2 | 13.1 | 18.8 | 23.4 | 30.1 | 13.8 | 3.2 | ||||||||||||
| SD | 24.6 | 26.7 | 19.7 | 19.8 | 21.6 | 15.6 | 8.6 | 2.0 | ||||||||||||
| e--Estimate. f--Forecast. N.A.--Not available | ||||||||||||||||||||
Table 3
| Total Commercial Debt At Year-End (Long- And Short-Term) | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Bil. $ | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | Share of 2023f total commercial debt (%) | Total commercial debt 2023f | |||||||||||
Abu Dhabi | 17.6 | 17.3 | 29.4 | 43.9 | 46.8 | 45.8 | 50.0 | 1.7 | 2,889.6 | |||||||||||
Albania | 5.9 | 6.5 | 6.5 | 8.0 | 8.7 | 8.0 | 8.6 | 0.3 | ||||||||||||
Angola | 60.4 | 56.9 | 51.4 | 51.7 | 36.3 | 39.2 | 42.0 | 1.5 | ||||||||||||
Armenia | 2.8 | 4.3 | 5.6 | 5.6 | 0.2 | |||||||||||||||
Azerbaijan | 11.4 | 10.7 | 9.3 | 2.6 | 4.1 | 5.1 | 5.5 | 0.2 | ||||||||||||
Bahrain | 28.2 | 31.8 | 31.5 | 38.8 | 38.3 | 39.0 | 40.2 | 1.4 | ||||||||||||
Belarus | 6.9 | 6.1 | 6.3 | 7.4 | 8.2 | 9.0 | 7.7 | 0.3 | ||||||||||||
Benin | 2.9 | 3.8 | 3.5 | 4.6 | 3.3 | 3.3 | 4.1 | 0.1 | ||||||||||||
Bosnia and Herzegovina | 0.1 | 0.1 | 0.1 | 0.1 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Botswana | 0.9 | 1.0 | 1.3 | 1.9 | 2.0 | 2.3 | 2.5 | 0.1 | ||||||||||||
Bulgaria | 12.4 | 11.1 | 10.9 | 15.1 | 15.6 | 15.6 | 19.9 | 0.7 | ||||||||||||
Burkina Faso | 1.9 | 2.3 | 3.0 | 4.4 | 5.5 | 6.3 | 7.6 | 0.3 | ||||||||||||
Cameroon | 4.5 | 4.7 | 5.2 | 6.7 | 6.8 | 7.0 | 7.8 | 0.3 | ||||||||||||
Cape Verde | 1.3 | 1.3 | 0.5 | 0.8 | 1.0 | 1.1 | 1.1 | 0.0 | ||||||||||||
Congo, D.R. | 2.5 | 3.2 | 2.1 | 2.2 | 2.7 | 3.3 | 4.0 | 0.1 | ||||||||||||
Congo-Brazzaville | 3.7 | 6.4 | 6.5 | 7.0 | 6.3 | 7.1 | 6.8 | 0.2 | ||||||||||||
Cote d'Ivoire | 20.9 | 25.1 | 24.5 | 28.0 | 1.0 | |||||||||||||||
Croatia | 34.8 | 35.4 | 35.1 | 42.7 | 41.0 | 35.5 | 40.7 | 1.4 | ||||||||||||
Egypt | 184.9 | 225.9 | 251.9 | 291.1 | 348.0 | 377.8 | 276.3 | 9.6 | ||||||||||||
Ethiopia | 11.3 | 11.9 | 13.5 | 13.6 | 14.8 | 17.8 | 20.4 | 0.7 | ||||||||||||
Georgia | 2.0 | 2.6 | 2.0 | 2.4 | 2.4 | 3.1 | 3.2 | 0.1 | ||||||||||||
Ghana | 26.0 | 25.2 | 26.6 | 35.9 | 46.5 | 52.4 | 34.1 | 1.2 | ||||||||||||
Hungary | 94.7 | 94.5 | 93.1 | 114.7 | 116.2 | 113.1 | 123.9 | 4.3 | ||||||||||||
Iraq | 73.7 | 42.8 | 53.5 | 56.6 | 56.4 | 54.8 | 60.5 | 2.1 | ||||||||||||
Israel | 215.5 | 210.4 | 238.2 | 306.0 | 335.7 | 294.8 | 310.2 | 10.7 | ||||||||||||
Jordan | 31.0 | 27.5 | 29.5 | 32.2 | 24.8 | 25.8 | 27.1 | 0.9 | ||||||||||||
Kazakhstan | 23.4 | 23.6 | 27.3 | 32.6 | 36.9 | 40.8 | 45.9 | 1.6 | ||||||||||||
Kenya | 26.5 | 32.3 | 36.7 | 18.8 | 42.6 | 43.9 | 46.3 | 1.6 | ||||||||||||
Kuwait | 23.7 | 19.6 | 14.8 | 11.5 | 10.7 | 5.5 | 5.3 | 0.2 | ||||||||||||
Lebanon | 77.3 | 83.0 | 89.6 | 50.6 | 41.2 | 32.2 | 29.3 | 1.0 | ||||||||||||
Madagascar | 1.8 | 2.1 | 2.4 | 0.1 | ||||||||||||||||
Montenegro | 2.1 | 2.2 | 2.8 | 3.8 | 3.0 | 3.0 | 2.7 | 0.1 | ||||||||||||
Morocco | 62.7 | 64.5 | 66.3 | 79.3 | 81.1 | 80.0 | 86.5 | 3.0 | ||||||||||||
Mozambique | 6.9 | 8.8 | 5.0 | 5.9 | 7.3 | 7.7 | 8.8 | 0.3 | ||||||||||||
Nigeria | 49.2 | 44.5 | 58.2 | 59.4 | 58.8 | 72.6 | 87.5 | 3.0 | ||||||||||||
North Macedonia | 3.7 | 4.0 | 4.1 | 5.3 | 5.4 | 5.7 | 6.4 | 0.2 | ||||||||||||
Oman | 20.4 | 35.7 | 42.2 | 47.4 | 49.8 | 41.6 | 44.1 | 1.5 | ||||||||||||
Poland | 239.6 | 228.2 | 228.4 | 260.6 | 243.8 | 219.1 | 265.2 | 9.2 | ||||||||||||
Qatar | 83.0 | 95.3 | 109.5 | 104.9 | 104.9 | 97.8 | 85.9 | 3.0 | ||||||||||||
Ras Al Khaimah | 0.0 | 1.2 | 1.2 | 1.0 | 1.0 | 1.0 | 1.0 | 0.0 | ||||||||||||
Romania | 73.9 | 80.5 | 89.3 | 123.5 | 134.4 | 136.4 | 147.2 | 5.1 | ||||||||||||
Rwanda | 1.2 | 1.3 | 1.9 | 1.8 | 2.2 | 2.3 | 2.6 | 0.1 | ||||||||||||
Saudi Arabia | 118.1 | 128.4 | 159.8 | 200.5 | 242.6 | 263.6 | 275.0 | 9.5 | ||||||||||||
Senegal | 4.9 | 4.2 | 6.4 | 7.6 | 7.6 | 7.5 | 8.9 | 0.3 | ||||||||||||
Serbia | 15.5 | 14.2 | 14.5 | 20.1 | 21.5 | 19.8 | 20.1 | 0.7 | ||||||||||||
Sharjah | 4.9 | 6.7 | 9.1 | 11.5 | 15.1 | 17.0 | 19.3 | 0.7 | ||||||||||||
South Africa | 202.2 | 193.9 | 209.3 | 262.3 | 262.1 | 251.9 | 269.8 | 9.3 | ||||||||||||
St. Helena | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | |||||||||||||
Tajikistan | 0.5 | 0.5 | 0.5 | 0.6 | 0.9 | 1.0 | 0.9 | 0.0 | ||||||||||||
Togo | 0.6 | 2.6 | 3.8 | 4.0 | 3.8 | 4.3 | 0.1 | |||||||||||||
Turkiye | 209.3 | 182.6 | 204.5 | 226.6 | 187.2 | 193.3 | 187.3 | 6.5 | ||||||||||||
Uganda | 3.4 | 3.9 | 4.2 | 5.6 | 8.3 | 9.5 | 10.2 | 0.4 | ||||||||||||
Ukraine | 47.2 | 49.8 | 58.3 | 60.7 | 63.6 | 62.2 | 61.0 | 2.1 | ||||||||||||
Uzbekistan | 1.1 | 2.3 | 3.0 | 3.8 | 4.2 | 0.1 | ||||||||||||||
Zambia | 10.4 | 11.5 | 12.9 | 14.0 | 20.8 | 22.3 | 23.6 | 0.8 | ||||||||||||
| Breakdown by foreign currency rating category* | ||||||||||||||||||||
| Bil. $ | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | Share of 2023f total commercial debt (%) | Total commercial debt 2023f | |||||||||||
| AAA | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 2,889.6 | |||||||||||
| AA | 316.2 | 323.0 | 377.1 | 454.8 | 487.5 | 438.4 | 446.1 | 15.4 | ||||||||||||
| A | 381.5 | 377.4 | 404.2 | 473.5 | 498.1 | 489.3 | 546.5 | 18.9 | ||||||||||||
| BBB | 245.1 | 252.9 | 266.2 | 341.9 | 361.3 | 360.6 | 399.5 | 13.8 | ||||||||||||
| BB | 317.9 | 325.7 | 348.7 | 442.6 | 454.6 | 435.5 | 467.6 | 16.2 | ||||||||||||
| B | 692.5 | 676.4 | 753.4 | 823.6 | 847.1 | 903.8 | 830.6 | 28.7 | ||||||||||||
| CCC | 70.9 | 79.1 | 86.3 | 91.7 | 97.6 | 101.2 | 104.6 | 3.6 | ||||||||||||
| SD | 120.6 | 125.9 | 135.4 | 107.8 | 116.6 | 115.8 | 94.7 | 3.3 | ||||||||||||
| e--Estimate. f--Forecast. N.A.--Not available | ||||||||||||||||||||
Chart 3
Table 4
| Central Government Rollover Ratios And Debt Structure (% Of Total Debt, Including Bi-/Multilateral) | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2023 | |||||||||||||||||
| Commercial debt (% of total) | Short-term debt (% of total) | Foreign currency debt (% of total) | Long-term fixed-rate debt (% of total debt) | Inflation-indexed debt (% of total) | Bi-/Multilateral debt (% of total) | Rollover ratio (% of GDP) | Bi-/Multilateral debt (% of total) | |||||||||||
Abu Dhabi | 100.0 | 0.0 | 86.9 | 86.9 | 0.0 | 0.0 | 0.8 | 0.0 | ||||||||||
Albania | 71.1 | 17.8 | 47.1 | 64.3 | 0.0 | 29.0 | 19.4 | 27.9 | ||||||||||
Angola | 56.2 | 1.3 | 74.0 | 50.7 | 0.0 | 43.8 | 10.3 | 43.8 | ||||||||||
Armenia | 55.5 | 2.6 | 62.1 | 45.5 | 0.0 | 44.5 | 3.9 | 44.1 | ||||||||||
Azerbaijan | 53.2 | 6.7 | 74.4 | 63.5 | 0.0 | 46.9 | 2.1 | 43.4 | ||||||||||
Bahrain | 81.9 | 13.4 | 69.3 | 73.6 | 0.0 | 18.1 | 22.1 | 20.0 | ||||||||||
Belarus | 35.6 | 0.0 | 97.6 | 62.8 | 0.0 | 64.4 | 3.1 | 70.9 | ||||||||||
Benin | 38.7 | 5.8 | 64.2 | 93.0 | 0.0 | 61.3 | 7.0 | 61.3 | ||||||||||
Bosnia and Herzegovina | 0.6 | 0.0 | 100.0 | 59.4 | 0.0 | 99.4 | 2.3 | 99.6 | ||||||||||
Botswana | 58.5 | 11.1 | 41.5 | 50.9 | 0.0 | 41.5 | 4.2 | 42.2 | ||||||||||
Bulgaria | 86.6 | 0.0 | 70.9 | 99.2 | 0.0 | 13.4 | 1.7 | 11.2 | ||||||||||
Burkina Faso | 58.3 | 4.9 | 42.5 | 94.2 | 0.9 | 41.7 | 12.3 | 40.9 | ||||||||||
Cameroon | 39.8 | 3.4 | 71.9 | 81.2 | 0.0 | 60.2 | 5.0 | 60.0 | ||||||||||
Cape Verde | 35.2 | 1.9 | 64.8 | 98.1 | 0.0 | 64.8 | 5.0 | 64.8 | ||||||||||
Congo, D.R. | 36.0 | 3.2 | 65.0 | 96.8 | 0.0 | 64.0 | 0.7 | 64.0 | ||||||||||
Congo-Brazzaville | 54.2 | 0.0 | 42.7 | 86.8 | 0.0 | 45.9 | 8.5 | 47.0 | ||||||||||
Cote d'Ivoire | 71.7 | 0.0 | 60.7 | 93.0 | 0.0 | 28.3 | 2.3 | 28.3 | ||||||||||
Croatia | 91.0 | 6.8 | 44.2 | 78.5 | 0.0 | 9.0 | 9.0 | 8.9 | ||||||||||
Egypt | 83.9 | 26.4 | 30.9 | 70.7 | 0.0 | 16.1 | 33.4 | 16.5 | ||||||||||
Ethiopia | 49.7 | 17.1 | 53.1 | 52.1 | 0.0 | 50.3 | 6.9 | 42.7 | ||||||||||
Georgia | 29.7 | 1.3 | 75.1 | 66.3 | 0.0 | 70.3 | 3.5 | 68.0 | ||||||||||
Ghana | 81.4 | 7.1 | 61.5 | 89.6 | 0.0 | 18.7 | 12.1 | 22.2 | ||||||||||
Hungary | 93.4 | 6.3 | 25.2 | 65.6 | 16.9 | 6.6 | 11.0 | 7.5 | ||||||||||
Iraq | 50.6 | 0.0 | 61.8 | 90.0 | 0.0 | 49.5 | 3.7 | 48.6 | ||||||||||
Israel | 100.0 | 0.0 | 14.5 | 43.5 | 52.5 | 0.0 | 5.2 | 0.0 | ||||||||||
Jordan | 67.5 | 6.8 | 57.3 | 73.4 | 0.0 | 32.5 | 15.9 | 32.6 | ||||||||||
Kazakhstan | 85.7 | 0.9 | 35.7 | 79.0 | 4.6 | 14.3 | 2.3 | 16.2 | ||||||||||
Kenya | 64.1 | 7.5 | 49.2 | 30.4 | 0.0 | 35.9 | 7.5 | 35.9 | ||||||||||
Kuwait | 100.0 | 0.0 | 83.0 | 87.9 | 0.0 | 0.0 | 0.1 | 0.0 | ||||||||||
Lebanon | 98.0 | 0.3 | 92.8 | 95.7 | 0.0 | 2.0 | 6.6 | 2.0 | ||||||||||
Madagascar | 34.5 | 1.8 | 79.0 | 98.2 | 0.0 | 65.5 | 2.6 | 65.5 | ||||||||||
Montenegro | 68.8 | 1.0 | 4.8 | 78.9 | 0.0 | 31.2 | 4.7 | 44.5 | ||||||||||
Morocco | 80.7 | 3.1 | 26.9 | 86.2 | 0.0 | 19.3 | 11.4 | 20.9 | ||||||||||
Mozambique | 48.5 | 15.7 | 87.3 | 72.5 | 11.8 | 51.5 | 17.6 | 51.5 | ||||||||||
Nigeria | 76.0 | 14.6 | 40.0 | 82.8 | 0.0 | 24.0 | 3.3 | 24.0 | ||||||||||
North Macedonia | 79.0 | 8.3 | 76.6 | 75.0 | 0.0 | 21.0 | 9.6 | 21.6 | ||||||||||
Oman | 90.7 | 2.2 | 75.5 | 83.8 | 0.0 | 9.3 | 3.6 | 8.6 | ||||||||||
Poland | 90.2 | 1.1 | 25.0 | 70.7 | 5.7 | 9.8 | 3.8 | 9.8 | ||||||||||
Qatar | 100.0 | 0.0 | 57.0 | 100.0 | 0.0 | 0.0 | 5.5 | 0.0 | ||||||||||
Ras Al Khaimah | 100.0 | 0.0 | 100.0 | 100.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||
Romania | 91.2 | 14.6 | 46.5 | 80.6 | 0.0 | 8.8 | 11.6 | 9.6 | ||||||||||
Rwanda | 29.0 | 7.5 | 75.0 | 89.5 | 0.0 | 71.0 | 5.9 | 71.0 | ||||||||||
Saudi Arabia | 97.0 | 20.0 | 37.2 | 66.2 | 13.8 | 3.0 | 7.3 | 3.0 | ||||||||||
Senegal | 42.5 | 3.0 | 74.0 | 86.9 | 0.0 | 57.5 | 6.3 | 57.5 | ||||||||||
Serbia | 61.5 | 0.9 | 74.4 | 84.0 | 0.0 | 38.5 | 6.4 | 44.2 | ||||||||||
Sharjah | 100.0 | 5.5 | 80.9 | 55.7 | 0.0 | 0.0 | 6.0 | 0.0 | ||||||||||
South Africa | 97.2 | 9.4 | 11.8 | 58.2 | 20.7 | 2.8 | 8.4 | 3.4 | ||||||||||
St. Helena | N.M. | N.M. | N.M. | N.M. | N.M. | N.M. | 0.0 | N.M. | ||||||||||
Tajikistan | 27.0 | 0.3 | 87.1 | 99.7 | 0.0 | 73.0 | 2.0 | 72.8 | ||||||||||
Togo | 80.5 | 1.4 | 36.5 | 98.6 | 0.0 | 19.5 | 8.2 | 19.5 | ||||||||||
Turkiye | 89.2 | 0.5 | 65.5 | 70.5 | 9.9 | 10.8 | 4.0 | 9.5 | ||||||||||
Uganda | 45.1 | 6.1 | 61.1 | 56.1 | 0.0 | 54.9 | 5.8 | 54.3 | ||||||||||
Ukraine | 61.3 | 2.2 | 65.6 | 74.7 | 3.9 | 38.7 | 7.0 | 60.1 | ||||||||||
Uzbekistan | 18.9 | 3.5 | 92.2 | 60.3 | 0.1 | 81.1 | 3.1 | 81.2 | ||||||||||
Zambia | 70.8 | 10.0 | 65.0 | 76.5 | 6.8 | 29.3 | 18.6 | 29.3 | ||||||||||
| Breakdown by foreign currency rating category* | ||||||||||||||||||
| 2022 | 2023 | |||||||||||||||||
| Commercial debt (% of total) | Short-term debt (% of total) | Foreign currency debt (% of total) | Long-term fixed-rate debt (% of total debt) | Inflation-indexed debt (% of total) | Bi-/Multilateral debt (% of total) | Rollover ratio (% of GDP) | Bi-/Multilateral debt (% of total) | |||||||||||
| AAA | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||
| AA | 100.0 | 0.0 | 31.5 | 60.7 | 35.3 | 0.0 | 4.1 | 0.0 | ||||||||||
| A | 93.8 | 10.9 | 32.1 | 68.6 | 9.8 | 6.2 | 5.3 | 6.4 | ||||||||||
| BBB | 91.0 | 8.6 | 41.0 | 75.1 | 5.7 | 9.0 | 7.7 | 9.7 | ||||||||||
| BB | 84.1 | 5.9 | 33.9 | 70.3 | 10.4 | 15.9 | 6.7 | 16.7 | ||||||||||
| B | 73.8 | 12.7 | 49.9 | 70.8 | 1.7 | 26.2 | 9.6 | 27.9 | ||||||||||
| CCC | 57.1 | 6.4 | 61.9 | 72.0 | 3.3 | 42.9 | 8.0 | 55.0 | ||||||||||
| SD | 75.2 | 5.1 | 74.8 | 83.8 | 1.4 | 24.8 | 9.1 | 29.1 | ||||||||||
| f--Forecast. N/A.--Not applicable | ||||||||||||||||||
Table 5
| Sovereign Ratings | ||||||
|---|---|---|---|---|---|---|
| Local currency ratings | Foreign currency ratings* | |||||
Abu Dhabi | AA/Stable/A-1+ | AA/Stable/A-1+ | ||||
Albania | B+/Stable/B | B+/Stable/B | ||||
Angola | B-/Stable/B | B-/Stable/B | ||||
Armenia | B+/Positive/B | B+/Positive/B | ||||
Azerbaijan | BB+/Stable/B | BB+/Stable/B | ||||
Bahrain | B+/Positive/B | B+/Positive/B | ||||
Belarus | CCC/Negative/C | --/--/SD | ||||
Benin | B+/Stable/B | B+/Stable/B | ||||
Bosnia and Herzegovina | B/Positive/B | B/Positive/B | ||||
Botswana | BBB+/Stable/A-2 | BBB+/Stable/A-2 | ||||
Bulgaria | BBB/Stable/A-2 | BBB/Stable/A-2 | ||||
Burkina Faso | CCC+/Stable/C | CCC+/Stable/C | ||||
Cameroon | B-/Stable/B | B-/Stable/B | ||||
Cape Verde | B-/Stable/B | B-/Stable/B | ||||
Congo, D.R. | B-/Stable/B | B-/Stable/B | ||||
Congo-Brazzaville | CCC+/Stable/C | CCC+/Stable/C | ||||
Cote d'Ivoire | BB-/Stable/B | BB-/Stable/B | ||||
Croatia | BBB+/Stable/A-2 | BBB+/Stable/A-2 | ||||
Egypt | B/Stable/B | B/Stable/B | ||||
Ethiopia | CCC/Negative/C | CCC/Negative/C | ||||
Georgia | BB/Stable/B | BB/Stable/B | ||||
Ghana | CCC+/Stable/C | --/--/SD | ||||
Hungary | BBB-/Stable/A-3 | BBB-/Stable/A-3 | ||||
Iraq | B-/Stable/B | B-/Stable/B | ||||
Israel | AA-/Stable/A-1+ | AA-/Stable/A-1+ | ||||
Jordan | B+/Stable/B | B+/Stable/B | ||||
Kazakhstan | BBB-/Stable/A-3 | BBB-/Stable/A-3 | ||||
Kenya | B/Negative/B | B/Negative/B | ||||
Kuwait | A+/Stable/A-1 | A+/Stable/A-1 | ||||
Lebanon | CC/Negative/C | --/--/SD | ||||
Madagascar | B-/Stable/B | B-/Stable/B | ||||
Montenegro | B/Stable/B | B/Stable/B | ||||
Morocco | BB+/Stable/B | BB+/Stable/B | ||||
Mozambique | B-/Stable/B | CCC+/Stable/C | ||||
Nigeria | B-/Negative/B | B-/Negative/B | ||||
North Macedonia | BB-/Stable/B | BB-/Stable/B | ||||
Oman | BB/Stable/B | BB/Stable/B | ||||
Poland | A/Stable/A-1 | A-/Stable/A-2 | ||||
Qatar | AA/Stable/A-1+ | AA/Stable/A-1+ | ||||
Ras Al Khaimah | A-/Stable/A-2 | A-/Stable/A-2 | ||||
Romania | BBB-/Stable/A-3 | BBB-/Stable/A-3 | ||||
Rwanda | B+/Stable/B | B+/Stable/B | ||||
Saudi Arabia | A-/Positive/A-2 | A-/Positive/A-2 | ||||
Senegal | B+/Stable/B | B+/Stable/B | ||||
Serbia | BB+/Stable/B | BB+/Stable/B | ||||
Sharjah | BBB-/Stable/A-3 | BBB-/Stable/A-3 | ||||
South Africa | BB/Positive/B | BB-/Positive/B | ||||
St. Helena | BBB-/Stable/A-3 | BBB-/Stable/A-3 | ||||
Tajikistan | B-/Stable/B | B-/Stable/B | ||||
Togo | B/Stable/B | B/Stable/B | ||||
Turkiye | B/Stable/B | B/Stable/B | ||||
Uganda | B/Negative/B | B/Negative/B | ||||
Ukraine | CCC+/Stable/C | CCC+/Stable/C | ||||
Uzbekistan | BB-/Stable/B | BB-/Stable/B | ||||
Zambia | CCC+/Stable/C | --/--/SD | ||||
| *Ratings as of March 6, 2023. | ||||||
Factors Considered In Our Estimates
Our estimates focus on debt issued by a central government in its own name. We exclude local government and social security debt, as well as debt issued by other public bodies and government-guaranteed obligations. In terms of commercial debt instruments, our estimates for long-term borrowing include bonds with tenors of more than one year, issued either on publicly listed markets or sold as private placements, as well as commercial bank loans.
In addition to commercial debt, some of the estimates we use in this study encompass bilateral and multilateral debt. We do not include government debt that may be issued by some central banks for monetary-policy purposes. All reported forecast figures are our own estimates and do not necessarily reflect the issuers' projections. We factor in our expectations regarding central government deficits, our assessment of governments' potential extra-budgetary funding needs, and our estimates of debt maturities. Assumptions that we express in dollars are subject to exchange-rate variations.
Related Research
- Sovereign Debt 2023: Borrowing Will Stay Elevated Despite Rising Cost Of Debt, March 9, 2023
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As an expert in global finance and economic analysis, I'll delve into the key concepts and information provided in the article you shared:
-
Global Interest Rate Cycle and Emerging Markets (EM):
- The article suggests that as the global interest rate cycle turns, EM EMEA (Europe, Middle East, and Africa) is expected to see a modest increase in gross long-term commercial borrowing in 2023, reaching $434.9 billion.
-
U.S. Monetary Policy and Currency Volatility:
- The risk to EM funding conditions is highlighted, particularly due to shifts in U.S. monetary policy. The article emphasizes that U.S. monetary policy and related currency volatility are key factors influencing EM borrowing conditions.
-
Commercial Debt Stock in EMEA EM Sovereigns:
- The projection indicates that EMEA EM sovereigns' commercial debt stock should reach $2.9 trillion by the end of 2023, accounting for 36.1% of GDP. This is a record in dollar terms but still below the peak during the pandemic.
-
Issuance Trends and Factors Affecting Borrowing:
- The article discusses the impact of aggressive monetary tightening by the U.S. Fed and a strengthening dollar in 2022, leading to a drop in EM EMEA sovereign commercial issuance. As interest rates stabilize, a modest increase in issuance is expected in 2023 due to elevated fiscal gaps and attractive local and foreign-exchange yields.
-
Sovereigns' Commercial Debt Levels and Projections:
- Projections for 2023 indicate that nine EMEA EM sovereigns have more than doubled their commercial debt levels in dollar terms since 2017. Egypt is expected to remain the largest EMEA EM sovereign issuer of commercial debt, with Turkey not far behind.
-
Key Themes for 2023:
- Higher-rated energy-importing EM sovereigns, such as Poland, Israel, and Morocco, are expected to increase issuance. Recently defaulted sovereigns like Ukraine and Ghana are anticipated to face a credit crunch, with significant drop-offs in issuance. Oil exporters' issuance is expected to be modest.
-
Debt Levels in Sub-Saharan Africa:
- Sub-Saharan African sovereign commercial debt levels are on the rise but make up only 12% of total sovereign commercial debt in dollar terms in EM EMEA. Some countries in the region rely on concessional sources of financing.
-
Top EMEA EM Issuers:
- The article identifies the five largest EMEA EM issuers (Egypt, Turkey, Poland, Israel, and Romania), which are projected to account for just over half of gross commercial borrowing in 2023 in dollar terms.
-
Estimates and Forecasts:
- The tables and charts provide detailed estimates and forecasts for gross long-term commercial borrowing, debt stock, rollover ratios, and other metrics for various EMEA EM sovereigns, categorized by foreign currency rating.
-
Sovereign Ratings:
- The article concludes with the sovereign ratings of various countries, reflecting their creditworthiness and stability.
In summary, the article offers a comprehensive analysis of the factors influencing commercial borrowing in EM EMEA, including global economic conditions, U.S. monetary policy, sovereign credit ratings, and specific trends within the region. The provided estimates and forecasts give insights into the expected trajectory of commercial debt for different sovereigns.
