The Centre for International Governance Innovation (CIGI) has published Further Reform of Sovereign Debt Restructuring: An Agenda for 2015 co-authored by Sauvé Senior Fellow Brett House and CIGI Senior Fellow Richard Gitlin
Further Reform of Sovereign Debt Restructuring: An Agenda for 2015
CIGI Policy Brief No. 54
by: Richard Gitlin and Brett House*
In September 2014, the UN General Assembly passed Resolution 63/304, which expressed the will of many member states to move toward the development of a multilateral framework for sovereign debt restructuring. Through this improved contractual language and International Monetary Fund (IMF) process reforms, the international community made advances to reduce the costs of sovereign debt restructuring for debtors and creditors. Little, however, has been done to reduce the inhibitions debtor countries face in dealing proactively with creditors to prevent and treat sovereign debt distress. To help address this reform lacuna, this policy brief suggests implementation of a Sovereign Debt Forum, revisions to the terms of the IMF’s Flexible Credit Line, and improvement to borrow and lender codes of conduct. The brief concludes that additional practical reforms could be undertaken to provide distressed sovereigns with more breathing room to address their problems and make restructuring terms stick once they have been agreed.
*In addition to his role as a Sauvé Fellow, Brett is a Visiting Scholar at Massey College, University of Toronto; and an Advisor to Tau Investment Management, a start-up impact fund. His current work focuses on sovereign debt restructuring, development finance, impact investing and macroeconomic growth. He not only writes extensively on these topics, but is frequently called on by media for his consistently clear, concise, summaries of complex economic and financial issues.
The Centre for International Governance Innovation (CIGI) is an independent, non-partisan think tank focused on international governance. Led by experienced practitioners and distinguished academics, CIGI supports research, forms networks, advances policy debate and generates ideas for multilateral governance improvements. Conducting an active agenda of research, events and publications, CIGI’s interdisciplinary work includes collaboration with policy, business and academic communities around the world.