scholarly journals Restructuring Sovereign Debt

2003 ◽  
Vol 17 (4) ◽  
pp. 75-98 ◽  
Author(s):  
Barry Eichengreen
Keyword(s):  
Collective Action ◽  
Financial Markets ◽  
Empirical Evidence ◽  
Sovereign Debt ◽  
Emerging Market ◽  
International Community ◽  
Collective Action Clauses ◽  
Debt Crises ◽  
New Evidence ◽  
The Way

This paper provides new empirical evidence relevant to the debate over the desirability of reforms to the way that financial markets and the international community deal with sovereign debt crises. In particular, given the ongoing opposition of investors and some sovereigns to greater use of collective action clauses (CACs) in emerging market bonds, we present new evidence on the way that financial markets have priced the use or non-use of CACs.

Good Faith in Sovereign Debt Restructuring: Mapping a Shift from Enforcement to Voluntary Compliance

2007 ◽  
Vol 28 (2) ◽  
Author(s):  
Dania Thomas ◽  
Javier García-Fronti
Keyword(s):  
Collective Action ◽  
Sovereign Debt ◽  
Legal Rule ◽  
Good Faith ◽  
Fair Dealing ◽  
Voluntary Compliance ◽  
Debt Market ◽  
Specific Standard ◽  
Collective Action Clauses ◽  
The U.S

AbstractOur examination of changes in the period leading up to the Argentine debt exchange and after, reveals that with Collective Action Clauses (CACs), the sovereign debt market is increasingly reliant on good faith as a standard of fair dealing to ensure fair and orderly debt restructurings in the future. Unlike the entrenched, enforceable, doctrinal good faith in domestic jurisdictions such as the U.S., the norm relied on in the sovereign debt market is a contextual open norm similar to the notion of Treu und Glauben, section 242 BGB of the German civil code. It is not a legal rule with specific requirements that need to be fulfilled. This paper reveals that reliance on a contextual, open norm is evidence of a shift in the framework that regulates sovereign debt restructurings: a shift from enforcement to voluntary compliance. Further, we argue that in the absence of a multilateral, regulatory, framework that embeds good faith as a specific standard of fair dealing, this reliance will exacerbate not solve the problem of sovereign debt restructurings.

scholarly journals Are African Stock Markets Inefficient? New Evidence on Seasonal Anomalies

2018 ◽  
Vol 65 (3) ◽  
pp. 283-301 ◽  
Author(s):  
Júlio Lobão
Keyword(s):  
Financial Markets ◽  
Stock Returns ◽  
Stock Markets ◽  
Emerging Market ◽  
Social Resources ◽  
Decision Makers ◽  
Informational Efficiency ◽  
Seasonal Predictability ◽  
Holiday Effects ◽  
New Evidence

Abstract It is widely acknowledged that having efficient financial markets is paramount in the allocation of social resources to their most productive uses. This paper explores the informational efficiency of six of the most important African stock markets for indication of seasonal predictability in stock returns. The results reveal that all markets exhibited some kind of seasonal patterns. The prevalence of the phenomenon was higher in the Egyptian and Tunisian markets, suggesting the presence of inefficient prices. Surprisingly, the only advanced emerging market of the sample (South Africa) showed a relatively large number of anomalies. This paper also reports the existence of strong pre-holiday effects and turn-of-the-month effects in most of the markets under scrutiny. Moreover, this study is the first to document the presence of quarterly effects in African markets. Collectively, the evidence obtained highlights the opportunity for arbitrageurs to reap profits as well as the need of decision-makers to implement legal and regulatory reforms in the markets of the continent.

Crisis Management and Resolution

2017 ◽  
Author(s):  
Yilmaz Akyüz
Keyword(s):  
Collective Action ◽  
Crisis Management ◽  
Emerging Economies ◽  
Public Debt ◽  
Financial Crises ◽  
Sovereign Debt ◽  
External Debt ◽  
Debt Restructuring ◽  
Domestic Debt ◽  
Collective Action Clauses

This chapter argues that the conventional approach to the management and resolution of external financial crises in emerging economies is inefficient and inequitable and needs to be reformed. Such reforms need to account for increased complexities arising from deepened integration, notably the difficulties in differentiating between external and domestic debt in terms of their holders, currency denomination, and governing laws. Effective debt resolution mechanisms would be needed to bail-in creditors whether the crisis is one of liquidity or solvency, or due to private or sovereign debt, or locally or internationally issued external debt, particularly since crises caused by excessive private borrowing lead to large increases in public debt. Debt workouts should include temporary standstills, protection against creditor litigation, lending into arrears and debt restructuring and combine statutory and voluntary elements, including collective action clauses, duly reformed to avoid the kind of predicaments encountered during the Argentinian restructuring.

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