Emerging countries experience real exchange rate depreciations around defaults. In this paper, we examine this observed pattern empirically and through the lens of a dynamic stochastic general equilibrium model. The theoretical model explicitly incorporates bond issuances in local and foreign...

Motivated by the recent increase in domestic banks' holdings of domestic sovereign debt (i.e., home bias) in the European periphery, this paper analyzes implications of banks' home bias for the sovereign's debt sustainability. The main findings, based on a sample of advanced (AM) and emerging...

'The IMF's Role in the Prevention and Resolution of Sovereign Debt Crises' provides a guided narrative to the IMF's policy papers on sovereign debt produced over the last 40 years. The papers are divided into chapters, tracking four historical phases: the 1980s debt crisis; the Mexican crisis...

This paper documents the two debt restructurings that Grenada undertook in 2004-06 and 2013-15.Both restructurings emerged as a consequence of weak fiscal and debt situations, whichbecame unsustainable soon after external shocks hit the island economy. The two restructurings provided liquidity...

This paper examines the causes, processes, and outcomes of Belize's 2016-17 sovereign debt restructuring-its third episode in last 10 years. As was the case in the earlier two restructurings, in 2006-07 and in 2012-13, the 2016-17 debt restructuring was executed through collaborative engagement...

This paper examines the causes, processes, and outcomes of the two Belize sovereign debt restructurings in 2006–07 and in 2012–13 that occurred outside of an IMF-supported program. It finds that the motivation for the two debt restructurings differed, as the former was driven by external...

Sovereigns' public capital influences sovereign debt crises and resolution. We compile a dataset on public expenditure composition around restructurings with private external creditors. We show that during restructurings, public investment experiences severe decline and slow recovery, differs...

Sovereigns' public capital influences sovereign debt crises and resolution. We compile a dataset on public expenditure composition around restructurings with private external creditors. We show that during restructurings, public investment (i) experiences severe decline and slow recovery, (ii)...