Low- to upper-middle-income countries’ external obligations $6.4 trillion
The current debt crisis closely resembles the archetypal wave of developing-country sovereign defaults that began in Mexico in 1982, when, like today, abundant, cheap debt financing came to a sudden stop, and sharp hikes in global interest rates caused the cost of servicing accumulated debt stocks to spike.
The International Monetary Fund currently classifies 39 low-income countries – all but four in Africa – as being in actual or potential “debt distress.”
And this tally does not even include some of the most dramatic cases, such as Sri Lanka and Pakistan, whose per capita incomes rank them just above the poorest category.
Harnoys-Vannier and Cohen identify two new features of this otherwise unchanging landscape. The first concerns the scale and growth rate of sovereign debt. Excluding China, low- to upper-middle-income countries’ external obligations increased by 65% – reaching a combined $6.4 trillion – in the ten-year period ending in 2021.
The current approach to developing-country debt is no longer fit for purpose. At the very least, the Paris summit should mark the point at which the search for a new global financing pact began in earnest.
Brigitte Granville Project Syndicate 16 June 2023
Brigitte Granville, Professor of International Economics and Economic Policy at Queen Mary University of London, is the author of Remembering Inflation (Princeton University Press, 2013) and What Ails France? (McGill-Queen’s University Press, 2021).
Dow’s bear market low of 777 points in August 1982.
Det datum som angavs som utgångspunkt för uppgången på börsen i New York var den 12 augusti 1982. Vad var det då, frågar man sig, som hände fredagen den 13 augusti, som satte fart på världens aktiebörser.
Jo, det som hände den dagen var att Mexiko förklarade att man inte längre kunde betala sin utlandsskulder. Det var /den dåvarande/ skuldkrisens födelsedag
https://englundmacro.blogspot.com/2022/05/volcker-if-i-had-known-what-was-going.html
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