Venezuela, a country that has endured nearly three continuous years of economic and social crises, is all but certain to touch off a new round of instability — one that is not altogether unfamiliar territory for emerging markets.
With inflation logging near triple-digit gains and crude oil — the lifeblood of the Bolivarian Republic's economy — deeply entrenched in a bear market, market observers are bracing themselves for the prospect of a calamitous debt default sometime this year. Last month, Venezuelan president Nicolas Maduro used his national address on Jan. 15 to declare an "economic emergency," augmented by a political stalemate with the country's congress. The International Monetary Fund estimated Venezuela's economy contracted by at least 7 percent in 2015.
More than a decade ago, Argentina's messy collapse triggered the largest sovereign debt default in history. Venezuela's external debt, estimated to be $185 billion, according to central bank data, is considerably more than Argentina's 2001 default on more than $100 billion of its obligations.
Reference: CNBC
Read More: http://www.cnbc.com/2016/02/
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