The British Financial Times said that about 20 developing countries are threatened with a fate similar to what happened in Sri Lanka due to economic problems and accumulated debts, including Arab and Islamic countries.
The newspaper pointed out that the list of countries that appear at risk is long and varied, and includes more than 20 emerging market countries that are heavily indebted and find themselves forced to choose between paying creditors or providing food and fuel for their people.
She said that among those countries are Egypt, Tunisia, Pakistan and Ghana, and that the four countries are now in talks with the International Monetary Fund to save their economy.
The newspaper report indicated that many low- and middle-income countries are suffering due to the high food and fuel prices that began with the outbreak of the Corona pandemic and then worsened during the war in Ukraine.
The United Nations Food Price Index indicates that food prices rose by 23.1% since the beginning of this year until last June, and expectations indicate that energy prices will remain high.
In its latest World Economic Outlook, the International Monetary Fund forecast growth in emerging market and developing economies to decline from 6.8% in 2021 to 3.6% this year.
The Financial Times said that with weak growth in emerging economies, there is a rise in borrowing costs.
Prices in the United States are rising at the fastest pace in 40 years, which prompted the Federal Reserve to raise interest rates dramatically.
The newspaper pointed out that the occurrence of an economic downturn in the United States may constitute relief for countries prone to the collapse of the economy, as it will reduce demand for energy, and reduce global borrowing costs, as the Federal Reserve will be forced to reduce interest rates, which will lead to a decline in the exchange rate of the US dollar.
The newspaper concluded that the exposure of the largest economy in the world to a recession would not be a good thing in general.