Economic Paper

2310-1385 (online)
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This series examines current economic issues from a Commonwealth perspective. The titles in the series are technical papers of topical interest to specialists concerned with trade, micro and macroeconomics, development economics and related subjects.

LongTerm Debt Sustainability in LowIncome Countries

LongTerm Debt Sustainability in LowIncome Countries

The HIPC Initiative Revisited You do not have access to this content

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Njuguna S. Ndung'u, Matthew Odedokun, H. K. R. Amani, Anna Msutze, Christopher Gilbert, Alexandra Tabova
01 Mar 2004
9781848598324 (PDF)

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Drawing on experiences in a wide range of countries, this book highlights the advantages and problems of multipleshift systems. It also makes practical suggestions on ways to make multipleshift systems operate effectively. The book is intended for (i) national and regional policymakers, and (ii) headteachers and others responsible for running multipleshift schools.

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  • Foreword

    Some 20 years ago, in November 1983, the Commonwealth Heads of Government at their New Delhi meeting, notwithstanding indications that the word economy was recovering and interest rates were coming down, decided to establish an expert group on the debt of developing countries. In July 1984 the expert group, under the chairmanship of Lord Lever of Manchester, presented its report to the then Commonwealth Secretary-General, Sir Shridath Ramphal.

  • Introduction

    A recent review of the Enhanced HIPC Initiative highlighted the successes and challenges, as well as the policy and institutional constraints, of the current debt relief efforts and the problem of long-term debt sustainability in low-income countries in general. Besides high levels of poverty and fragile growth performances, HIPCs and other low-income countries are also prone to adverse, largely unpredictable shocks, including price shocks and deterioration in the terms of trade. They are also affected by natural disasters, epidemics and violent civil conflict.

  • Long-term Debt Sustainability in Developing Countries

    A problem that has been the focus of much attention and contention over the years, with serious implications for development, is that of debt. The debt "hangover" of many developing countries, and particularly of the Heavily Indebted Poor Countries (HIPCs), has not been resolved, despite important and significant measures and initiatives adopted by creditors at the national and multilateral levels. The nature of the debt problems of these countries varies from acute balance of payments difficulties requiring immediate action to longer-term situations relating to structural, financial and transfer-of-resource problems which require appropriate longer-term measures.

  • Long-term Debt Sustainability of Public Debt in Sub-Saharan Africa

    The debt problem has imposed a severe burden on poor countries since the 1980s. It is one of the greatest challenges of the twenty-first century in terms of creating productive capacities and alleviating poverty in the least developed countries. The majority of poor countries are to be found in sub-Saharan Africa.

  • Life After Debt Relief: Sustainable Debt and Poverty Alleviation

    This paper discusses alternative concepts and measures of debt sustainability and their evolution over time. This is a prelude to the more central objective of identifying determinants of debt sustainability and analysing their future movements with a view to gauging the debt sustainability of the HIPCs upon their graduation from HIPC status. One broad category of determinants of debt sustainability considered relates to the existing stock of debt at the point of graduation from HIPC status.

  • Realignment of Debt Service Obligations and Ability to Pay in Concessional Lending

    We consider schemes which have the potential to increase the flexibility of heavily indebted primary producing countries in meeting their debt service obligations by making debt service repayments contingent on the world prices of the commodities they export. The result would be that countries would repay more in high price years and less in low price years. This would facilitate debt service by gearing it towards "ability to pay" and would offset the variability of export earnings.

  • Sustainable Debt: What Lessons Can be Learnt from the Current HIPC Initiative?

    The Heavily Indebted Poor Countries Initiative was launched in 1996 to address the debt burdens of some low-income countries. This was in response to concerns that traditional debt restructuring mechanisms through the Paris Club had failed to reduce debt burdens and that these were threatening future growth and poverty reduction. The Enhanced HIPC Initiative (HIPC II) was launched in 1999 to provide deeper and more rapid debt relief to a larger number of countries.

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