ISLAMABAD – Pakistan survived odds with surpisiong default risk comeback despite political and regional turmoil as Bloomberg Data shows South Asian nation as most improved emerging market in Credit Risk.
The development is major boost to economic outlook, as report highlights major decline in Pakistan’s default probability in the last year, showing strengthened investor confidence and enhanced financial stability.
The country’s credit default swap (CDS)-implied default probability fell from 59% to 47%, marking an 11-percentage-point drop—the largest among emerging markets globally.
The government members shared Bloomberg’s global rankings, calling it breakthrough in economic stabilization efforts, progress in structural reforms, and productive engagement with global lenders.
Credit default swaps are financial tools used to manage credit risk. A declining CDS-implied default probability indicates that investors perceive a reduced risk of the country defaulting on its debt.
The South Asian also outperformed countries like Argentina, Nigeria, and Tunisia in improving its sovereign risk profile. In contrast, some emerging economies, including Turkey, Egypt, Ecuador, and Gabon, have witnessed a rise in default risk over the same period.
Bloomberg Report Pakistan
Schehzad emphasized that the improvement comes on the back of timely debt repayments, a more favorable outlook from global credit rating agencies, and a commitment to continued economic reform.
“Pakistan’s position as the most improved emerging market underlines a return of investor trust and growing financial credibility,” he stated. “The country is not just back in the game—it is moving ahead with confidence and resilience.”
This development is being seen as a positive signal for global investors and financial institutions, as Pakistan continues to work toward long-term economic sustainability.
