Norway Has the World's Safest Sovereign Debt

CMA released their "Global Sovereign Credit Risk Report" for Q1/2010 (link below) earlier this week.

The 17-page report is absolutely loaded with interesting information, and is well worth the read.

The two tables that I found the most interesting were "World's Riskiest Sovereign Debt" and "World's Safest Sovereign Debt".

According to the report, Venezuela currently holds the dubious distinction of being the world's riskiest sovereign debt investment.

Venezuela, according to the report, has a 48.5% cumulative probability of default over the next five years.

Argentina, Pakistan, Ukraine and Iraq round out the top five. The cost to insure against default for all five of these sovereign debt offerings is staggeringly high.

Dubai and Greece, which have both seen their share of troubles over the past year or so, are #6 and #9 on the list, respectively.

Lithuania, Lebanon and Romania fell out of the top 10 list in Q1/10, while Pakistan, Egypt and Iraq made their way in.

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Scandinavian countries dominate the list of the top 10 safest sovereign debt offerings.

Norway sits in the #1 spot, thanks to a miniscule 1.6% 5 Year CPD (Cumulative Probability of Default).

The next five countries on the list are: Finland (2.1% CPD), Germany (2.8% CPD), Sweden (3.0% CPD), Denmark (3.0% CPD) and Denmark (3.0% CPD).

Where is the United States on this list, you might ask?

The United States is currently sitting in the 10th spot, after dropping from 7th to 10th in the past quarter. I guess that's what trillion dollar deficits as far as the eye will see will do for you.. assuming that the United States continues down its current path, I think that it's safe to say that the US will soon fall out of the top ten..

World's safest sovereign debt? Norway. World's riskiest sovereign debt? Venezuela.

Source: CMAVision.com - Global Sovereign Credit Risk Report (Q1/10)


Filed under: General Knowledge



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