Author: Jürgen Kaiser
More countries in the Global South may be heading toward a new debt crisis as the result of a new wave of debt financing due to low global interest rates coinciding with low commodity prices. Thus far, innovative approaches to a debt workout with regard to the new crisis have been in short supply. To rise to the next challenge, there is much to learn from the HIPC/MDRI initiatives of the 1990s and 2000s, namely, that it may be possible to overcome political deadlocks by designing debt relief exclusively for a limited group of countries. Such limited debt relief schemes could then prompt procedural innovation, such as comprehensiveness and impartiality, which would remedy weaknesses of the HIPC/MDRI schemes and debt restructuring mechanisms at large.
FES New York is pleased to share this proposal in a new FES International Policy Analysis publication by Erlassjahr’s Jürgen Kaiser.