The interest rate hike by the Federal Reserve to combat inflation is a serious headache for highly indebted countries, which will have to devote a larger portion of their resources to paying interest on their debt. Some of them are at high risk of defaulting on their payments.

Do you know which country is at the highest risk of default these days?

ANSWER

El Salvador— The Central American country, which has a dollarized economy and was the first to adopt Bitcoin as its national currency, tops the ranking compiled from Bloomberg data and visualized by Visualcapitalist. Interest payments on El Salvador’s sovereign debt account for 4.2% of GDP, and the country faces a US$800 million debt maturity in January 2023.