The report details how political challenges may make it increasingly difficult for multilateral institutions, including the
- Cuts in government spending are likely to trigger protests linked to austerity, which are already on the rise particularly in low-income countries
- Countries with a high ratio of public interest payments to public revenue may be most vulnerable to sovereign debt crises in the near to medium term
- Partly because of intensified geopolitical competition, the politics of sovereign debt restructuring following debt crises have become increasingly complicated with countries more likely to turn to non-traditional bailout options as a result
- Climate change is likely to become an increasingly important driver of crises of debt sustainability, necessitating reform of the international debt and financial architecture
This edition of the WTW Political Risk Index features research conducted by the geopolitical consultants at Oxford Analytica and the credit insurance group Credendo, as well as WTW’s trade credit and political risk teams. The complete report can be downloaded here.
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