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Cluster Analysis of Debt Indicators of the Countries of the Global South
Firsanova V. O.

Firsanova, Violetta O. (2024) “Cluster Analysis of Debt Indicators of the Countries of the Global South.” Business Inform 10:41–54.
https://doi.org/10.32983/2222-4459-2024-10-41-54

Section: International Economic Relations

Article is written in Ukrainian
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UDC 339.97

Abstract:
The topic of this study is relevant in the context of the growing indebtedness of the countries of the Global South as having the largest population in the world and being in a system crisis. The aim of this article is to study the levels of risk of debt pressure by debt indicators of the countries of the Global South. As a result of the study, two groups of clusters were identified using the Statgraphics Centurion statistical package according to these indicators and the associated risks. The first group is composed on the basis of the methodology of the Institute of International Finance, the initial data for which were calculated by the author. The second group is based on the already calculated IMF data. All the statistical information used in the study is presented in the latest report of the Global Sovereign Debt Monitor 2024. The study includes 129 countries in the Global South. In each group of clusters, the statistical package of Statgraphics Centurion identified three clusters, where countries were divided according to the risks of debt pressure according to five debt indicators into: 1) countries that do not have risks (category 0 – non-critical); 2) countries with small or significant risks (category 1-4 – slightly critical and 5-9 – critical; 3) countries with high risks of debt pressure (category 10-15 – very critical or in the status of default). The study showed that, according to the Institute of International Finance and the IMF, the debt situation in the countries of the Global South does not completely coincide. Taking into account the results of the cluster analysis, it can be concluded that many countries in the Global South are at high risk of debt pressure (or the status of default). The countries of the African continent are at the greatest risk of debt pressure. The countries of the Global South have different causes of debt: military conflicts, dependence on the oil and gas sector, underdeveloped infrastructure, etc. Prospects for further research on this topic lie in the analysis of statistical data of such international organizations as the Institute of International Finance, IMF, World Bank, etc., in the coming years in order to track the risk dynamics of debt of different groups of countries of the world. The indebtedness of the Global South leads to the undermining of the economic stability of these countries, and therefore to a significant increase in global debt. Also, for further research, it is possible to use the trends in debt pressure risks, which are presented in these reports, to study the dynamics of debt pressure risks in different years.

Keywords: global debt, countries of the Global South, cluster analysis, debt indicators, levels of risks of debt pressure, Institute of International Finance, IMF.

Tabl.: 5. Bibl.: 9.

Firsanova Violetta O. – Candidate of Sciences (Economics), Senior Lecturer, Department of International Economic Relations and Logistics, Education and Research Institute «Karazin Institute of International Relations and Travel Business» of V. N. Karazin Kharkiv National University (6 Svobody Square, Kharkiv, 61022, Ukraine)
Email: [email protected]

List of references in article

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“Debt Indicators“. https://www.issai.org/wp-content/uploads/2019/08/GUID-5250-Guidance-on-the-Audit-of-Public-Debt-Appendix-1-Debt-Indicators.pdf
“Global Debt Monitor 2023“. https://www.imf.org/-/media/Files/Conferences/2023/2023-09-2023-global-debt-monitor.ashx
“Global Sovereign Debt Monitor 2024“. https://erlassjahr.de/wordpress/wp-content/uploads/2024/04/GSDM24-online.pdf
“Guidance on the Audit of Public Debt“. https://www.issai.org/wp-content/uploads/2019/08/GUID-5250-Guidance-on-the-Audit-of-Public-Debt-Exposure-Draft.pdf
“International Debt Report 2023“. https://openknowledge.worldbank.org/collections/8f676469-d666-503c-98c7-31495fc450ab
Ayhan Kose, M. et al. “Global Waves of Debt. Causes and Consequences“. World Bank Group 2020. https://thedocs.worldbank.org/en/doc/279031577823091771-0050022019/original/GlobalWavesofDebtfullreport.pdf
“World Economic Situation and Prospects as of mid-2024“. https://desapublications.un.org/publications/world-economic-situation-and-prospects-mid-2024
“Fiscal Monitor 2023 APR On the Path to Policy Normalization“. https://www.imf.org/en/Publications/FM/Issues/2024/04/17/fiscal-monitor-april-2024

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