Globalisation, Sovereign Debt and Adjustment Programmes in Africa: Implications for Creditors, Debtors and Policy Makers in Europe

2016 ◽  
pp. 95-110
Keyword(s):  
Sovereign Debt ◽  
Policy Makers

Sovereign Debt: Theory

2019 ◽  
Author(s):  
Vivian Zhanwei Yue ◽  
Bin Wei
Keyword(s):  
Sovereign Debt ◽  
Economic Cost ◽  
National Government ◽  
Sovereign Default ◽  
Policy Makers ◽  
Quantitative Studies ◽  
Policy Relevance ◽  
Debt Crises ◽  
Legal Consequences

This article reviews the literature on sovereign debt, that is, debt issued by a national government. The defining characteristic of sovereign debt is the limited mechanisms for enforcement. Because a sovereign government does not face legal consequences of default, the reasons why it makes repayment are to avoid default penalties related to reputation loss or economic cost. Theoretical and quantitative studies on sovereign debt have investigated the cause and impact of sovereign default and produced analysis of policy relevance. This article reviews the theories that quantitatively account for key empirical facts about sovereign debt. These studies enable researchers and policy makers to better understand sovereign debt crises.

scholarly journals European Sovereign Debt Crisis and its Impact on Financial Markets and Institutions

2015 ◽  
Vol 2 (3) ◽  
pp. 113-120
Author(s):  
Afzal Ahmad
Keyword(s):  
Gross Domestic Product ◽  
Financial Institutions ◽  
Sovereign Debt ◽  
Debt Crisis ◽  
Domestic Product ◽  
Sovereign Debt Crisis ◽  
Policy Makers ◽  
Markets And Institutions ◽  
European Sovereign Debt Crisis ◽  
The Impact

This paper examines the European sovereign debt crisis that began in 2009; it mostly considers Greece and then Italy and Portugal since they were affected by the crisis.  It gives the emergence and the causes of the crisis as well as its effect on their debt as a percentage to Gross Domestic Product and their Real Gross Domestic Product.  It also analyses the impact on sovereign bond and its yields, the stock, gold, derivatives and forex markets, including the impact on financial institutions, it uses graphical illustrations from Bloomberg to back the analysis.  It further assesses the measures taken so far by policy makers and financial institutions to curb the situation.  It finally considers the impact of the crisis on financial landscape and lessons learnt from it.

Introduction

2020 ◽  
pp. 1-20
Author(s):  
Michael Schiltz
Keyword(s):  
Transaction Cost ◽  
Sovereign Debt ◽  
Network Effects ◽  
International Monetary System ◽  
Late Nineteenth Century ◽  
Financial Policy ◽  
Policy Makers ◽  
Monetary System ◽  
Long Run ◽  
Currency Competition

This chapter lays out the conceptual framework needed to grasp the challenges facing exchange bankers in late nineteenth-century Asia. It borrows from the transaction cost literature underlying the study of the structure of the international monetary system; and it subscribes to the notion that such structure is the product of international currency competition. In the historical literature, applications of these insights are surprisingly scarce. Yet it is demonstrated that, by (1) settling on the existence of a distinction between ‘center’ and ‘periphery’ and (2) the existence of ‘network effects’, the transaction cost approach may explain the persistence of monetary arrangements in the long run. Remarkably, seemingly ‘retreating’ currencies retain a degree of superiority that would not be warranted in case network effects were absent; vice versa, non-liquid currencies have only a very small chance at climbing the ladder of currency prestige—they are structurally disadvantaged. It is argued that the distinction between center and periphery is real, not just analytical, and has had tangible implications for monetary and financial policy makers in the fields of sovereign debt and trade finance.

Latin America and the Caribbean Standardized Public Debt Database: Data as of December 2019

2020 ◽  
Author(s):  
Keyword(s):  
Latin America ◽  
Financial Markets ◽  
Public Debt ◽  
Sovereign Debt ◽  
Regional Policy ◽  
Debt Management ◽  
Policy Makers ◽  
The Caribbean ◽  
Cross Country ◽  
Clear Objective

The LAC Debt Group believes that to have sound regional policy it is important to have valid, comparable, and standardized data on Latin America and the Caribbean (LAC). Therefore, at the core of the initiative is the development of a standardized sovereign debt database to help debt managers, policy makers, and other actors of financial markets, analyze the composition of public debt in LAC. The information presented in this database is provided by the Debt Management Offices of 26 LAC countries in response to a questionnaire specifically created to allow comparability of data. The questionnaire is intended to compile up-to-date standardized statistics to conduct cross-country comparisons over clear, objective, and homogeneous definitions of public debt.

scholarly journals The Shift-Contagion Effect Of Global Financial Crisis And The European Sovereign Debt Crisis On OECD Countries

2013 ◽  
Vol 30 (1) ◽  
pp. 301 ◽  
Author(s):  
Irfan Akbar Kazi ◽  
Mohamed Mehanaoui ◽  
Farhan Akbar
Keyword(s):  
Financial Crisis ◽  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Sovereign Debt Crisis ◽  
Policy Makers ◽  
Dynamic Correlations ◽  
European Sovereign Debt Crisis ◽  
Recent Financial Crisis ◽  
The Global Financial Crisis

<p>This article investigates shift-contagion as defined by Forbes and Rigobon (2002) in 16 OECD member economies during most recent financial crisis i.e. global financial crisis (2008-2009) and European sovereign debt crisis (2009-2012), using multivariate asymmetric dynamic conditional correlation model developed by Cappiello et al. (2006). The empirical analyses provide substantial evidence of shifts in the dynamic correlations and hence reconfirm shift-contagion during the global financial crisis that originated from U.S. However, there is no evidence in support of shift-contagion during the European sovereign debt crisis which originated from events in Greece. The results provide important implications for investors and policy makers.</p>

Investor confidence and life insurance demand: can economic condition limit life insurance business?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Danish Ahmed ◽  
Yuantao Xie ◽  
Khelfaoui Issam
Keyword(s):  
Life Insurance ◽  
Sovereign Debt ◽  
Economic Condition ◽  
Market Condition ◽  
Insurance Demand ◽  
Policy Makers ◽  
Content Type ◽  
Investor Confidence ◽  
Confidence Levels ◽  
Life Insurance Demand

PurposeLife insurance is bought with a prior belief that promise stipulated in policy will be honored when due. Discernibly, this belief is backed by the confidence that financial markets and economy will demonstrate satisfactory performance. However, individuals' confidence levels may get shaken through naïve reinforcement learning if they witness negative market or economic condition. Considering this the authors investigate the relationship between investor confidence and life insurance demand.Design/methodology/approachThe authors used bias corrected bootstrapped sample of OECD economies to examine the link between investor confidence and life insurance demand when two possible economic conditions were witnessed: 1) normal/economic expansion and 2) economic/debt impairment. The findings are robust to alternate estimation techniques and endogeneity.FindingsThe authors found that lower investor confidence, sovereign debt impairment and negative market condition will have negative repercussion on life insurance demand. On the other hand, investor confidence-life insurance demand nexus is merely influenced by market and economic condition.Originality/valueThis is a premier research explaining the nexus between investor confidence and life insurance demand in the context of life-cycle hypothesis, sovereign ratings channel and experience-confidence-belief framework. The finding will help economic policy-makers in developing pre-emptive measures to protect life insurance businesses from negative repercussions of lower confidence and negative market conditions.

scholarly journals Sub-Sahara Africa’s Infrastructure Funding Gap: Potentials from Sukuk Financing

2018 ◽  
Vol 2 (4) ◽  
pp. 26-34
Author(s):  
Abdulazeez Abdurraheem ◽  
Asmadi Mohamed Naim
Keyword(s):  
Sovereign Debt ◽  
Negative Impact ◽  
Well Being ◽  
Infrastructure Development ◽  
Policy Makers ◽  
Infrastructural Development ◽  
Efficient Management ◽  
The People ◽  
Debt Market ◽  
Funding Gap

Sub-Sahara African (SSA) region as a large part of the African continent suffers huge infrastructure deficit mainly as a result of the vast funding gap. The negative impact of the infrastructure deficiency continues to constrain socio-economic development and the general well-being of the people of the region. Heavy reliance on the traditional sources of funding by many of the countries in the region has failed to meet ever-growing demands for infrastructural development of the region. Potentials presented by Islamic finance are yet to be exploited by a large number of countries in the region. This study evaluates the depth of utilisation of Islamic capital market using Sukuk instruments as another source of funding to fill the observed funding gap for infrastructure development. This study finds that the use of Sukuk as a long-term financing instrument is still at its infancy stage in the region. The paper, therefore, suggests that the SSA countries can undertake rapid and massive infrastructure developments in the region through the use of Sukuk instruments, thereby eliminating increasing sovereign debt over-hang from the conventional debt market. This study also recommends that policy makers in the region put in place required laws and regulations that will provide enabling environments for effective utilisation of Sukuk instruments for infrastructural development. Similarly, strong political will on the part of the region’s political leaders is essential in nurturing strong institutions that can engender policy continuity to ensure effective and efficient management of infrastructure projects funded by Sukuk instruments.

scholarly journals Determing the Role of Debt in the Economy and a New Approach for Solving Sovereign Debt Crises

2013 ◽  
Author(s):  
Munawar Iqbal
Keyword(s):  
Sovereign Debt ◽  
Global Financial Crisis ◽  
Debt Crisis ◽  
Policy Makers ◽  
New Approach ◽  
The Past ◽  
History Of ◽  
Debt Crises

This paper aims to begin a dialogue on how to seek a longer term solution to the sovereign debt problems in general and those of EU in particular. Although the history of debt crises is quite old, none of the several solutions proposed and tried in the past have been successful to curb recurring debt crisis. This issue has assumed critical importance as the Eurozone debt crisis, which followed after the 2007-09 global financial crisis. Several governments have been outvoted in Europe due to this crisis and the cohesion of Eurozone is at stake. A rethinking on debt creation and its macroeconomic effects are being seriously studied. It seems that traditional options available to policy makers have lost much of their luster. It is high time that unconventional measures may have to be offered for consideration to provide longer term solution. This paper is a brief on the Islamic approach to the role of debt, and has potential to limit debt creation in the long term. We present some basic tenets of that approach referring in particular to the current developed nation sovereign debt crisis.  

Latin America and the Caribbean Standardized Public Debt Database: Data as of December 2020

2021 ◽  
Author(s):  
Keyword(s):  
Latin America ◽  
Financial Markets ◽  
Public Debt ◽  
Sovereign Debt ◽  
Regional Policy ◽  
Debt Management ◽  
Policy Makers ◽  
The Caribbean ◽  
Cross Country ◽  
Clear Objective

The LAC Debt Group believes that to have sound regional policy it is important to have valid, comparable, and standardized data on Latin America and the Caribbean (LAC). Therefore, at the core of the initiative is the development of a standardized sovereign debt database to help debt managers, policy makers, and other actors of financial markets, analyze the composition of public debt in LAC. The information presented in this database is provided by the Debt Management Offices of 26 LAC countries in response to a questionnaire specifically created to allow comparability of data. The questionnaire is intended to compile up-to-date standardized statistics to conduct cross-country comparisons over clear, objective, and homogeneous definitions of public debt.

scholarly journals What Factors Influence European Corporate Bond Spread?

2020 ◽  
Vol 15 (4) ◽  
pp. 87
Author(s):  
Maria Cristina Arcuri ◽  
Gino Gandolfi ◽  
Manou Monteux ◽  
Giovanni Verga
Keyword(s):  
Sovereign Debt ◽  
Debt Crisis ◽  
Credit Default Swap ◽  
Corporate Bond ◽  
Sovereign Debt Crisis ◽  
Policy Makers ◽  
Sovereign Bonds ◽  
European Sovereign Debt Crisis ◽  
Credit Default ◽  
Main Determinants

This paper examines the main determinants of corporate euro-bond spread. We analyse a large sample of corporate euro-country bonds over the period May 2005 -January 2012, considering three sub-periods: May 2005- July 2007 (pre-crisis period), August 2007-April 2010 (worldwide financial crisis) and May 2010-January 2012 (European sovereign debt crisis). We show that both liquidity risk and risk related to the country of the issuing firms affect corporate bond spread. We also find that the market yield of corporate bonds issued in the main European countries is, other things being equal, strongly influenced by the risk of the corresponding sovereign bonds and Credit Default Swap (CDS). Finally, we compare the yields of bonds issued by banks with those of bonds issued by firms from other sectors and find that the spread, other things being equal, is significantly higher for banks. These findings may have operating implications for market activity, regulators and policy makers.

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