Countries from Eastern Europe have borrowed $1.7 trillion or $1,700 billion abroad, much on short-term maturities. They must, reimburse this year the equivalent of a third of the region's GDP that is $400 billion.
Russia, which to a large extent depends on oil and gas exports, undergoes the burden of $500 billion dollars in debts of its oligarchs. It has used 36% of its foreign reserves since August 2008 in order to defend the rouble.
The banks of Austria have lent €230 billion to Countries of East Europe which accounts for 70% of Austria's GDP. Bad debt will represent 10% and could even reach 20%.
In Poland, 60% of mortgages are in swiss francs and the Zloty has been going down.
Hungary, the Balkans, the Baltics and Ukraine are not well, as well.
The debt from East Europe is mostly owed to banks of West Europe, especially Austria, Sweden, Greece, Italia and Belgium. 74% of the $4.9 trillion or $4,900 billion portfolio of loans feeding the emerging markets.
Spain is closely linked to Latin America; Britain and Switzerland are strongly involved in Asia.
The European Central Bank might have to purchase bonds in large quantities.
East Europe might need $400 billion to cover loans and boost the economy.
The IMF appears weak with its $200 billion or €155 billion.
Italy's public debt is following a rocketing trajectory, reaching 112% of GDP next year.
To get more information on that news go to:
http://www.telegraph.co.uk/finance/comment/ambroseevans-pritchard
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