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Addressing sovereign debt challenges in the era of COVID-19 and beyond: the role of the United Nations

Author

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  • Alberto Isgut

    (Acting Section Chief, Financing for Development Section, Macroeconomic Policy and Financing for Development Division, ESCAP)

Abstract

Traditionally, sovereign debt problems of developing countries have been discussed mostly at institutions representing the creditors, such as the Paris Club, and at the International Monetary Fund, but they have also been addressed by the United Nations, mostly in the context of its international conferences on financing for development. Although the views of the United Nations on debt are not widely known, they are highly relevant in the post-COVID-19 context, as inflationary pressures could lead to tightened global financial conditions and exacerbate debt vulnerabilities in developing countries. The present paper provides an overview of sovereign debt restructurings from the 1980s, a summary of the debt situation of Asia and the Pacific as a case study and a review of the views of United Nations on debt issues. It also offers suggestions to improve the global debt architecture based on such views by highlighting the importance of linking debt sustainability with sustainable development in debt restructuring workouts and through a hub-and-spoke institutional arrangement to disseminate prudential debt management practices and promote transparency.

Suggested Citation

  • Alberto Isgut, 2021. "Addressing sovereign debt challenges in the era of COVID-19 and beyond: the role of the United Nations," Asia-Pacific Sustainable Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 28(2), pages 149-192, December.
    • Handle: RePEc:unt:japsdj:v:28:y:2021:i:2:p:149-192
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    File URL: https://www.unescap.org/sites/default/d8files/2022-03/APSDJ%20Vol.28_No.2-5_31_03_22.pdf
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    References listed on IDEAS

    as
    1. Tamon Asonuma & Christoph Trebesch, 2016. "Sovereign Debt Restructurings: Preemptive Or Post-Default," Journal of the European Economic Association, European Economic Association, vol. 14(1), pages 175-214, February.
    2. Schumacher, Julian & Trebesch, Christoph & Enderlein, Henrik, 2021. "Sovereign defaults in court," Journal of International Economics, Elsevier, vol. 131(C).
    3. Lee Buchheit & Chanda DeLong & Guillaume Chabert & Jeromin Zettlemeyer, 2019. "How to Restructure Sovereign Debt: Lessons from Four Decades," Working Paper Series WP19-8, Peterson Institute for International Economics.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    debt sustainability; sustainable development; debt restructuring; United Nations;
    All these keywords.

    JEL classification:

    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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