Covid’s Next Economic Crisis: Developing-Nation Debt

Zambia was once a model in Wall Street’s rush to issue debt for the world’s poorest nations, attracting bigger orders and lower interest rates than some more-developed countries. Less than a decade later, the Southern African nation is straining to pay back more than $11 billion in loans, The Wall Street Journal reported. The world is gearing up for a battle over developing-country debt like few it has seen before. Rich and poor countries are at loggerheads with private investors that, over the past decade, replaced governments as the biggest creditors to emerging markets. Zambia looks set to become a case study in the clash over how to ease the debt load of developing countries that were ill-prepared for the financial pain inflicted by the coronavirus pandemic.

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