An economic perfect storm is battering emerging markets. Debt crises loom

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NPR, September 2, 2022
https://www.mprnews.org/story/2022/09/02/npr-global-economy-emerging-markets-inflation-debt
Various excerpts:

The U.S. dollar strengthened to a 20-year high against a collection of foreign currencies this week, spelling more trouble for heavily indebted smaller nations around the world. The stronger dollar makes payments on loans owed in U.S. currency more expensive. This comes as some lower-income countries face mounting economic problems and others — including Sri Lanka, Lebanon and Zambia — have already defaulted on their international debts.

Last week, Argentina slapped sweeping new restrictions on imports of everything from whiskey to software to consulting services to try to contain inflation that's running at over 70 percent. The South American nation has been hemorrhaging foreign currency and the strengthening U.S. dollar threatens to make that worse. In July, the value of the Argentine peso fell to a record low against the dollar on the black market.

"If you look at the history of emerging markets from the Latin American debt crisis in the 1980s, the Mexican peso crisis in 1994, to the different Argentine defaults, to the Brazilian crisis in the early 2000," Balcells ticks through a list of the most recent emerging market meltdowns, including the Asian financial crisis in the late '90s. "All of those periods always coincide with periods of interest rate hikes in the U.S."

Not only do poorer countries have larger debts in U.S. currency, now they are having to pay even more for imports bought in dollars as the currency strengthens. And this time around, global prices for fuel and food were already surging, due to currency fluctuations and significant supply shortfalls caused by the Russian invasion of Ukraine.

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Bloomberg: the number of emerging market borrowers that have debt trading at distressed levels has doubled over the last six months.

"the worst food security crisis any of us have ever seen," ... food makes up about 40% of consumer purchases in sub-Saharan Africa, so an increase in food prices weighs very heavily.

Countries mentioned: Sri Lanka, El Salvador, Argentina, Lebanon, Pakistan, Ghana, Nigeria, Zambia,