The 2008 financial crisis poses an unprecedented challenge to the assessment of sovereign risk.

As global economic conditions diverge, the characteristics that distinguish countries from one another are becoming more pronounced.  

The determinants of sovereign risk premia are increasingly rooted in countries' fundamentals, cautioning against broad-brush approaches. 

By differentiating clearly between economies, we unearth national idiosyncrasies which have an important bearing on countries' creditworthiness. 

Two key themes pervade our research: 

• Country fundamentals: Country-specific risk now matters much more. We eschew generalisations about geographical regions or groups of countries on the grounds that these mask important structural, economic and political differences between states.
• Reassessing risk: Sovereign risk assessment is in flux.  The global economy can not be neatly divided into developed countries and developing ones. Comparative analyses of countries' creditworthiness need to better reflect country-specific risk.