Part I Sovereign Debt Restructuring, 5 The Role of the International Monetary Fund

Sovereign Debt ◽

The Other ◽

Major Goal ◽

Debt Restructuring ◽

General Proposition ◽

There would be few dissenters from the general proposition that we should try to deal justly with debt. We have all watched in horror the collapse that has taken place in Argentina and the enormous cost paid by so many people in that country—as well as by the creditors of Argentina—from the massive financial and economic dislocation and disruption. I do not believe that what has occurred was inevitable.Unfortunately, some who address this issue of dealing with unmanageable debt situations have offered advice that, while emotionally appealing, is not operationally helpful. I will describe and justify the rationale and design of the proposal put forward by the International Monetary Fund for a Sovereign Debt Restructuring Mechanism (SDRM). Its major goal is to help reduce the unacceptably large costs associated with disorderly defaults by sovereign governments whose debt burdens have become unsustainable. The SDRM aims to get the countries' debts to sustainable positions and deal with the broader needs of the countries through the full array of aid and other mechanisms that are available— and, indeed, to enlarge and enhance these initiatives. I will also explain my misgivings about some of the other proposals, including the ones coming from the NGO community.

Sovereign Debt Restructuring: A Model-Law Approach

Journal of Globalization and Development ◽

10.1515/jgd-2015-0031 ◽

2015 ◽

Vol 6 (2) ◽

Cited By ~ 2

Author(s):

Steven L. Schwarcz

Keyword(s):

United Nations ◽

Sovereign Debt ◽

The Political ◽

International Treaties ◽

Debt Contracts ◽

Debt Restructuring ◽

Ability To Pay ◽

Model Law ◽

AbstractUnlike individuals and corporations, countries indebted beyond their ability to pay cannot use bankruptcy laws to restructure unsustainable debt. The United Nations and the International Monetary Fund have attempted to propose treaties to enable that debt restructuring, but the political difficulties of reaching a worldwide consensus have stymied their efforts. This article argues that a model-law approach to restructuring unsustainable sovereign debt should be feasible and effective because the vast majority of sovereign debt contracts are governed by the laws of either the debtor-state or two other jurisdictions. Those jurisdictions individually could enact a model law to give struggling nations a real prospect of equitably restructuring their debt to sustainable levels. By enabling such debt restructuring, that enactment would also help to foster the norms required to facilitate the development of international treaties.

Sovereign Debt Management During Debt Distress Periods

The Journal of Investing ◽

10.3905/joi.2018.1.071 ◽

2018 ◽

Keyword(s):

Sovereign Debt ◽

Market Access ◽

Debt Crisis ◽

Debt Management ◽

International Capital ◽

Debt Restructuring ◽

Economic Program ◽

Lending Decisions

Sound public debt-management policies during sovereign debt distress periods are key to efficiently resolving a debt crisis and regaining market access. In addition to understanding the causes, processes, and outcomes of sovereign debt restructurings, this article analyzes the role of the debt manager along with determinants and strategies to maintain/regain market access. The sovereign’s debt sustainability analysis and determination of loss of market access are two crucial elements in the IMF’s lending decisions to countries in debt distress. Various indicators used in assessing whether the sovereign can tap international capital on a sustained basis are discussed. When a sovereign debt restructuring needs to be undertaken, it is necessary to determine the financial terms of the debt operation. Some key principles in designing sovereign debt restructuring scenarios and ways in securing full-financing of the economic program and regaining market access are presented. We conclude by offering a few best practices on preventing and managing sovereign debt restructurings.

The Role Of The International Monetary Fund In Promoting Stability In The Global Economy

Financial Crisis Management in Regional Blocs ◽

10.1007/978-94-011-4864-1_17 ◽

1998 ◽

pp. 323-333

Author(s):

Philippe Maystadt

Keyword(s):

Global Economy ◽

The role of the International Monetary Fund

East Asia in Crisis ◽

10.4324/9780203025130-30 ◽

2002 ◽

pp. 230-248

Keyword(s):

UN-EU Cooperation on Financial Issues: The Role of The European Union at The International Monetary Fund and The World Bank

The United Nations and the European Union: An Ever Stronger Partnership ◽

10.1007/978-90-6704-471-4_7 ◽

2006 ◽

pp. 115-134

Author(s):

Carole Gamier ◽

Daniel Daco ◽

Francesca Di Mauro

Keyword(s):

European Union ◽

World Bank ◽

The European Union ◽

The World Bank ◽

The World ◽

Financial Issues ◽

The Role of the International Monetary Fund After the 2008 Crisis

Research in World Economy ◽

10.5430/rwe.v10n1p60 ◽

2019 ◽

Vol 10 (1) ◽

pp. 60

Author(s):

Marco Mele ◽

Floriana Nicolai

Keyword(s):

Foreign Exchange ◽

United Arab Emirates ◽

Foreign Exchange Market ◽

Exchange Market ◽

Governance Reform ◽

Extensive Introduction ◽

The 2008 Financial Crisis ◽

The purpose of this paper is to analyze the changes in the functions of the International Monetary Fund after the 2008 financial crisis. Following an extensive introduction concerning the subject of the study and which covers part of the economic literature, the focus was on governance reform and surveillance in the foreign exchange market. Finally, the empirical analysis was carried out concerning the manipulation of exchange rates in a period ranging from 2008-2016 and 15 countries (Taiwan, South Korea, Israel, China, Thailand, Macao, Switzerland, Hong Kong, Singapore, Norway, Qatar, United Arab Emirates, Kuwait, Trinidad and Tobago and Saudi Arabia) that in the period considered massively intervened in the foreign exchange market, keeping their respective currencies undervalued and acquiring an unfair competitive advantage to the detriment of partner economies. The results would tend to confirm that the manipulation of the exchange rate is a persistent and lasting element of the currency policies of the new millennium, highlighting an active insufficiency of the IMF’s action in the exercise of the oversight function on the currency policies of the Members.

The International Politics of African Debt

Political Studies ◽

10.1111/j.1467-9248.1987.tb00185.x ◽

1987 ◽

Vol 35 (1) ◽

pp. 1-17 ◽

Cited By ~ 1

Author(s):

Trevor Parfitt ◽

Stephen Riley

Keyword(s):

World Bank ◽

Significant Role ◽

International Politics ◽

African Countries ◽

Policy Paper ◽

External Indebtedness ◽

Policy Direction ◽

This paper assesses the international politics of Africa's growing external indebtedness and the pressures for policy direction that it produces. After the scale and character of the problem has been assessed, the paper looks, first, at the increasingly significant rôle of the International Monetary Fund (IMF) within Africa. The nature of external policy direction is then examined, particular attention being paid to the influential World Bank policy paper, the Berg Report. Its policy prescriptions are assessed in the light of conditions in several African countries. The paper concludes by examining alternatives to IMF policy direction, including default and collective disengagement.