Britain ranks below Peru in new ‘sovereign risk’ world order

Telegraph ^ | November 7th, 2011 | Ian Cowie

[markomalley]

Britain ranks below Peru in a new analysis by one of the world’s biggest fund managers of the risk to investors who buy government bonds. Norway, Sweden and Switzerland are the least risky bond issuers among 44 countries analysed in the BlackRock Sovereign Risk Index. At the other end of the scale, also in descending order, Egypt, Portugal and Greece are reckoned to be the most risky.

Britain falls near the middle of this new world order, ranking directly below Russia, China, Czech Republic, Israel and Peru. Some small comfort may be taken from the fact that gilts issued by the British Government are reckoned to be a better bet than bonds issued by France, the Philipines and Poland; which rank directly below Britain.

Dissatisfaction with credit rating agencies such as Standard & Poor’s, Fitch and Moody’s – which have issued nearly 100 sovereign risk downgrades since the global credit crisis began – prompted BlackRock to begin collating its own analysts’ views earlier this year. It claims back-testing of this analysis suggests it is more accurate than the credit rating agencies’ and that the current crisis will continue with more government’s getting into trouble with excess debt.

[SunkenCiv]

Thanks markomalley.

[Moltke]

Hmmm...does Peru export anything other than annoying street musicians?

[spetznaz]

Hmmm...does Peru export anything other than annoying street musicians? From www.state.gov:

Peru's major trading partners are the U.S., China, EU, Switzerland, Canada, and Japan. Peru’s exports include petroleum, gold, copper, apparel, tin, coffee, non-ferrous ores, asparagus, fishmeal, zinc, and textiles.

Peru is the world's top producer of silver, second in zinc, third in copper and tin, fourth in lead, and sixth in gold.

Peru is a source of both natural gas and petroleum. The $3.8 billion Peru LNG project was commissioned in June 2010, the largest investment in a single project ever made in Peru. The plant liquefies natural gas for export to Mexico and possibly the west coast of the United States and other countries, converting Peru into a net energy exporter in 2010.

[Moltke]

South Park. Season 12, episode 10. You can watch it online. ;-)