How does a country go bankrupt?

Question

So currently when someone is mentioning that the European Central Bank should raise interest rates, a counter argument is that some southern countries (Greece, Italy, Spain?) would go bankrupt because they are indebted.

What does “going bankrupt” even mean in that context? Like how can a country go bankrupt and what happens if it does? I don’t really get the concept.

In: 3

Answer 1

It can’t pay its debts. Countries take on lots of debt through bond sales. They have to pay interest on the bonds.