|
|
| Picture: Svilen.milev |
Following the global financial crisis, low-, middle-and high-income countries are seeing increased levels of sovereign debt. Today, no international mechanism exists to deal comprehensively and effectively with sovereign debt problems. This submission to the UN ad hoc committee on debt that was prepared and endorsed by 27 Civil Society Organizations, calls for an international and independent debt workout mechanism.
January 20, 2015 | Eurodad
Towards a lasting solution to sovereign debt problems
Countries all over the world are becoming increasingly vulnerable to sovereign debt problems following the financial crisis:
-
One quarter of all low-income countries are in debt distress or at high risk of debt distress. Another 29 countries are at moderate risk of debt distress;1
-
External loans to low income countries increased by 75 per cent between 2008 and 2012, a growing share is expensive non-concessional debt, and vulnerabilities are increasing.2
-
Two-thirds of impoverished countries face large increases in the share of government income spent on debt payments over the next ten years.
This looming debt crisis and the failure to deal efficiently with the current and past crises have triggered debates on how to ensure fair and predictable debt workout in the future.
