The period of the 1970s experienced a tremendous growth of debt of the less developed countries (LDCs). Between 1970 and 1980, the debt of the LDCs grew fivefold to $580 billion. Much of this growth of debt was accounted for by liberal lending of transnational commercial banks (TNBs). The...

This article discusses the process that debtor countries go through in the two mechanisms created to work out solutions for their huge and unpayable external debts, namely, the Paris Club and the Heavily Indebted Poor Countries (HIPC) Initiative. As the international lending process is...

This paper develops measures of emerging market credit spreads for the 1990s, based on data on new bond issues and bank loans, that cover a broader range of borrowers than the Brady bond spreads most commonly used to date. These measures are used to identify the impacts of credit ratings,...

One of the goals of the Heavily Indebted Poor Countries (HIPC) debt initiative is to provide additional resources for basic health care to the population of eligible developing countries. In this paper I investigate the effect of debt relief on per capita health expenditure in a sample of...

The World Bank is to forgive $12.24 billion in IDA debt payments from HIPC borrowers. It has received $1 billion from the HIPC Trust Fund to help offset these losses, but still has a $11.6 billion unfunded liability. The IMF has gold worth $38 billion on hand for which it has no actual use. This...

Debt relief is unlikely to stimulate investment and growth in the nations being considered for debt relief under the highly indebted poor countries (HIPCs) initiative. This is because the HIPCs do not suffer from debt overhang. The principal obstacle to investment and growth in the HIPCs is a...

In this paper I develop a model to investigate the connection between debt relief and current account sustainability. This model can be used as a key input in assessing whether a HIPC country's real exchange rate is 'overvalued,' and will thus need to go through devaluation. The working of the...

The COVID-19 pandemic has been a global shock with dramatic consequences on debts of governments called to alleviate the economic and social impact of the crisis on firms and households. We explore conditions for the feasibility of (COVID-19 generated) government debt relief, justified in...