The Countries Most Likely To Default
Pakistan
After partition from India and its independence, Pakistan still largely remains under the shadows of conflicts and terrorism. The disputed area of Kashmir between India and Pakistan still is the major issue. Decades of internal political disputes and low levels of foreign investment have led to slow growth of Pakistan.
The country's failure to expand a viable export base for other manufactures has left the country vulnerable to shifts in world demand. Over the past few years, low growth, high inflation, and high food prices, have increased the amount of poverty.
As a result of political and economic instability, the Pakistani rupee has depreciated more than 40 percent since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 in response to balance the payments crisis.
Tax collection is still a major problem in the country and according to The Express Tribune, merely one out of 200 citizens in the country files Income Tax return. This puts the country in heavy debts and Pakistan has a multi-billion dollar credit with International Monetary Fund. It remains stuck in a low-income, low-growth trap.
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