💸A country defaults on its debt when it is unable to pay back its lenders, which can result in economic consequences.
🌍Defaulting countries often face difficulties in accessing future borrowing and must convince lenders of their ability to repay.
🔒Creditors have limited options for recovering their money, as seizing assets or using force is generally prohibited.
📉Defaulting on debt can damage a country's reputation as a borrower and lead to higher interest rates in the future.
⚖️Recovery from default often requires restructuring and refinancing, but the process can be politically complex.