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Author: S. M. Ravi Kanbur Publisher: World Bank Publications ISBN: Category : Languages : en Pages :
Book Description
June 1996 A group of heavily indebted low-income countries (HIPCs), most in Sub-Saharan Africa, has continued to experience external debt problems. Because the HIPCs' economic characteristics and external imbalances are very different from those of middle-income countries, the analysis of debt problems and debt-reduction must be modified and complemented in important ways. Therefore, the authors revisit the methodological issues underlying debt sustainability analysis, as well as theory and empirical evidence on how large debts affect economic performance. Their main question is: Should consideration be given to more upfront debt reduction for HIPCs, over and above that provided under current mechanisms, or should debts continue to be refinanced, subject to conditionality? Ongoing refinancing with conditionality reduces moral hazard and gives countries an incentive to maintain good policies. However, this approach entails transition costs, can create uncertainty, may lack credibility, and can impede local ownership of reform programs. Upfront debt reduction can create moral hazard problems and may weaken the incentives for maintaining sound policy. There are theoretical arguments about why a high level of debt can impede investment and policy reform. Although empirical evidence concerning the hypothesis that HIPCs suffer significant adverse effects from their large debt overhang is inconclusive, evidence from middle-income countries suggests that debt reduction can benefit an economy if the policy environment is right. Whether there should be further debt reduction for specific heavily indebted low-income countries depends on the facts for each case and requires quantitative analysis of data about different forces at play in the countries involved.
Author: S. M. Ravi Kanbur Publisher: World Bank Publications ISBN: Category : Languages : en Pages :
Book Description
June 1996 A group of heavily indebted low-income countries (HIPCs), most in Sub-Saharan Africa, has continued to experience external debt problems. Because the HIPCs' economic characteristics and external imbalances are very different from those of middle-income countries, the analysis of debt problems and debt-reduction must be modified and complemented in important ways. Therefore, the authors revisit the methodological issues underlying debt sustainability analysis, as well as theory and empirical evidence on how large debts affect economic performance. Their main question is: Should consideration be given to more upfront debt reduction for HIPCs, over and above that provided under current mechanisms, or should debts continue to be refinanced, subject to conditionality? Ongoing refinancing with conditionality reduces moral hazard and gives countries an incentive to maintain good policies. However, this approach entails transition costs, can create uncertainty, may lack credibility, and can impede local ownership of reform programs. Upfront debt reduction can create moral hazard problems and may weaken the incentives for maintaining sound policy. There are theoretical arguments about why a high level of debt can impede investment and policy reform. Although empirical evidence concerning the hypothesis that HIPCs suffer significant adverse effects from their large debt overhang is inconclusive, evidence from middle-income countries suggests that debt reduction can benefit an economy if the policy environment is right. Whether there should be further debt reduction for specific heavily indebted low-income countries depends on the facts for each case and requires quantitative analysis of data about different forces at play in the countries involved.
Author: Ravi Kanbur Publisher: ISBN: Category : Languages : en Pages : 48
Book Description
A group of heavily indebted low-income countries (HIPCs), most in Sub-Saharan Africa, has continued to experience external debt problems. Because the HIPCs' economic characteristics and external imbalances are very different from those of middle-income countries, the analysis of debt problems and debt-reduction must be modified and complemented in important ways. Therefore, the authors revisit the methodological issues underlying debt sustainability analysis, as well as theory and empirical evidence on how large debts affect economic performance. Their main question is: Should consideration be given to more upfront debt reduction for HIPCs, over and above that provided under current mechanisms, or should debts continue to be refinanced, subject to conditionality? Ongoing refinancing with conditionality reduces moral hazard and gives countries an incentive to maintain good policies. However, this approach entails transition costs, can create uncertainty, may lack credibility, and can impede local ownership of reform programs. Upfront debt reduction can create moral hazard problems and may weaken the incentives for maintaining sound policy. There are theoretical arguments about why a high level of debt can impede investment and policy reform. Although empirical evidence concerning the hypothesis that HIPCs suffer significant adverse effects from their large debt overhang is inconclusive, evidence from middle-income countries suggests that debt reduction can benefit an economy if the policy environment is right. Whether there should be further debt reduction for specific heavily indebted low-income countries depends on the facts for each case and requires quantitative analysis of data about different forces at play in the countries involved.
Author: T. Addison Publisher: Springer ISBN: 0230522327 Category : Business & Economics Languages : en Pages : 334
Book Description
After a massive international campaign calling attention to the development impact of foreign debt, the Heavily Indebted Poor Countries (HIPC) initiative is now underway. But will the HIPC Initiative meet its high expectations? Will debt relief substantially raise growth? How do we make sure that debt relief benefits poor people? And how can we ensure that poor countries do not become highly indebted again? These are some of the key policy issues covered in this rigorous and independent analysis of debt, development, and poverty.
Author: Marco Arnone Publisher: Routledge ISBN: 1317154150 Category : Business & Economics Languages : en Pages : 300
Book Description
This book deals with the recent debt crises in developing countries and analyzes the design and implementation of the Heavily Indebted Poor Countries (HIPC) Initiative, by providing background concepts, pointing out the main drawbacks and suggesting a different approach to debt sustainability and debt relief programs. The authors merge academic, operational and institutional expertise, in order to provide an evaluation as complete and balanced as possible on the much-debated effectiveness of debt relief in fostering economic growth, reducing poverty and reaching debt sustainability. Marco Arnone and Andrea F. Presbitero assess the joint evolution of external and domestic public debt and produce original empirical evidence on the potential effects of public debt on investment, economic growth and institution-building in low- and middle-income countries. The book also explores relevant and up-to-date policy issues, such as the loans-grants mix and the development of responsible lending strategies in foreign assistance, the surge of non-concessional and domestic borrowing by low-income countries, and the impact of the 2008-2009 global financial crisis on debt sustainability.
Author: Mr.Anthony R. Boote Publisher: International Monetary Fund ISBN: 1451844107 Category : Business & Economics Languages : en Pages : 30
Book Description
The paper describes the debt burden of low-income countries and the traditional mechanisms that have been implemented by the international community to alleviate this burden. While these mechanisms are sufficient to reduce the external debts of many heavily indebted poor countries (HIPCs) to sustainable levels provided these countries implement sound economic policies, they are likely insufficient for a number of countries. To deal with these cases, the World Bank and the IMF have jointly proposed and implemented the HIPC Initiative. The paper describes this Initiative and suggests that it should enable HIPCs to exit from the debt rescheduling process.
Author: International Monetary Fund Publisher: INTERNATIONAL MONETARY FUND ISBN: 9781451822960 Category : Languages : en Pages : 73
Book Description
This paper presents an assessment of Liberia's eligibility and qualification for assistance under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative. The macroeconomic framework underlying the Debt Relief Analysis (DRA) in this paper was updated to reflect discussions on the policy framework underlying a proposed three-year Poverty Reduction and Growth Facility/Extended Fund Facility (PRGF/EFF)-supported program. Finally, this study discusses the floating completion point triggers. Fiscal policy has been anchored on a balanced cash-based budget. The government has also implemented other measures to address long-standing problems in financial management and economic governance.
Author: Simeon Inidayo Ajayi Publisher: International Monetary Fund ISBN: Category : Business & Economics Languages : en Pages : 68
Book Description
The African debt crisis, like its Latin American counterpart, started in the early 1980s and is not yet over! Debt was big news in the 1980s when the international financial system appeared threatened by the heavy indebtedness of a number of developing countries. More recently, the external debt of a group of 41 countries referred to as heavily-indebted poor countries (HIPCs), 32 of which are classified as severely indebted has been receiving increased attention. Most of the severely indebted low income countries which have been having problems managing their debt service obligations are in sub-Saharan Africa. 2 As a matter of fact, over the last one and a half decades, the external debt burden in many of the countries in this group has worsened, and the problem, if anything, has become even more serious. Debt ratios indicate that the overall external debt has become so large relative to the economic size of these countries and relative to export earnings that it would be impossible to pay a significant part of it in the short run without the imposition of what amounts to an impossible burden on those nations (Hope, Sr., 1996).
Author: S. M. Ravi Kanbur
Author: S. M. Ravi Kanbur
Author: Stijn Claessens
Author: Ravi Kanbur
Author: 
Author: T. Addison
Author: United States. General Accounting Office
Author: Marco Arnone
Author: Mr.Anthony R. Boote
Author: International Monetary Fund
Author: Simeon Inidayo Ajayi