Pakistan tops global emerging market rankings in sovereign risk improvement — Bloomberg Intelligence

Vehicles move past a shipping container yard along a road in Karachi, Pakistan, on June 10, 2025. (REUTERS/File)
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Updated 28 June 2025
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Pakistan tops global emerging market rankings in sovereign risk improvement — Bloomberg Intelligence

  • Government calls the development ‘a resounding signal’ to investors about Pakistan’s improving economy
  • It attributes the new outlook to economic stabilization, structural reforms and successful IMF engagement

KARACHI: Pakistan has recorded the world’s sharpest decline in sovereign default risk over the past year, topping Bloomberg Intelligence’s Global Emerging Market (EM) Rankings for credit risk improvement, according to new data cited by a senior finance official on Saturday.

The data, published by Bloomberg’s research arm, showed that Pakistan’s credit default swap-implied probability of default fell from 59 percent to 47 percent over the past 12 months, a drop of 11 percentage points. The change marks the biggest reduction among tracked emerging markets, outpacing countries like Argentina, Tunisia and Nigeria, as default risk rose in others such as Egypt, Gabon and Turkiye.

Credit default swaps (CDS) are insurance-like financial contracts that allow investors to hedge against the risk of a government failing to repay its debt. Issued and traded by large financial institutions, these contracts pay out in the event of a default. The higher the cost of a CDS, the greater the perceived risk. Bloomberg Intelligence uses CDS pricing to assess a country’s sovereign risk in its Global EM Rankings.

“Pakistan stands out globally as the most improved economy in terms of reduction in sovereign default risk,” said Khurram Schehzad, adviser to the finance minister, in a social media post. “This is a resounding signal to global investors: Pakistan is not only back on the map— it is moving forward with stability, credibility, and reform at its core,” he added.

Bloomberg Intelligence is a highly regarded financial data and media company widely used by global investors, analysts and institutions.

The improvement in Pakistan’s risk profile comes after the South Asian nation narrowly avoided a sovereign default in 2023. With dwindling reserves and mounting debt repayments, Islamabad secured a short-term bailout from the International Monetary Fund (IMF) with the support of key allies including Saudi Arabia, the United Arab Emirates and China.

Since then, Pakistan has undertaken a series of IMF-recommended structural reforms and fiscal adjustments aimed at stabilizing the economy.

Credit rating agencies such as Standard & Poor’s and Fitch have acknowledged the progress with improved outlooks, while the government has prioritized timely debt servicing and macroeconomic discipline.

Schehzad attributed the improved outlook to “macroeconomic stabilization, structural reforms, successful IMF engagement and timely debt repayments,” noting that investor confidence had begun to return.


Gun attack kills policeman, civilian during polio drive in northwest Pakistan

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Gun attack kills policeman, civilian during polio drive in northwest Pakistan

  • Pakistani authorities have temporarily suspended vaccination activities in Bajaur district
  • The campaign that started this week aims to vaccinate over 45 million children in Pakistan

PESHAWAR: A gun attack on a polio vaccination team in Pakistan’s northwestern Bajaur district killed a police constable and a civilian on Tuesday, prompting authorities to suspend vaccination activities in the area, officials said.

The attack took place in a small settlement of Bajaur’s Salarzai tehsil, near the Afghan border, where militants have targeted health workers and security personnel involved in polio campaigns in the past despite police escorts assigned to protect vaccination teams.

Pakistan and neighboring Afghanistan are the only two countries where polio remains endemic, and vaccination drives have frequently been disrupted by militant violence, misinformation and vaccine hesitancy.

Authorities routinely deploy police and paramilitary forces to guard polio teams, but attacks have continued in recent years.

“The incident occurred at approximately 12:20 p.m. in Village Tangi Loei Khel, UC Khar 2, when unidentified individuals opened fire on Constable Sajjad, killing him on the spot,” said Shadab Younas, a media officer at the Peshawar Emergency Operations Center.

A civilian bystander, Fazal Rahim, was also hit by gunfire and later died of his injuries after being taken to Khar Hospital, Younas continued, adding that the polio team itself was unharmed.

Global polio tracking data show that 30 of the 39 confirmed wild poliovirus type 1 cases worldwide in 2025 were reported in Pakistan, with the remainder in Afghanistan. Pakistan recorded 74 polio cases in 2024, a sharp rise from six cases in 2023 and just one in 2021, underscoring the fragility of eradication efforts.

Prime Minister Shehbaz Sharif condemned the attack and directed authorities to swiftly identify and bring the perpetrators to justice, according to a statement from his office.

He said the assault on those serving the nation’s polio eradication effort was “deeply regrettable” and reaffirmed that the campaign would continue with full resolve until the disease is eliminated.

The National Emergency Operations Center (NEOC) said the nationwide polio campaign was continuing for a second day, reporting that more than 13.3 million children were vaccinated across the country on the first day of the drive.

The campaign, which started on Dec. 15 and will continue until Dec. 21, aims to administer oral polio drops to more than 45 million children across the country.

Health officials urged parents and communities to cooperate with vaccination teams and ensure children under five receive the drops.

Pakistan and Afghanistan are conducting the polio campaign simultaneously, the NEOC said.