Sovereign Debt Restructurings: A Survey on Concepts, Trends, Empirics, and Theory

Tamon Asonuma, Hyungseok Joo and Akira Sasahara

Public Policy Review, 2022, vol. 18, issue 1, 1-16

Abstract: Many sovereigns have issued external debt held by private creditors abroad. Sovereign debt restructurings might take place not only after sovereigns suffer a debt crisis but also preemptively without missing payments. The current paper provides a survey covering basic concepts and trends, empirics, and theory. First, we define concepts and the process of sovereign debt restructurings and overview recent trends in the last decade. Second, we explain empirical findings and theoretical implications on three issues: (i) the process and outcomes under preemptive debt restructurings; (ii) how business and financial cycles in creditor countries affect the process and the outcome of debt restructurings; and (iii) impacts of debt restructurings on the domestic economy and future borrowing.

Keywords: sovereign debt; external debt; sovereign default; debt restructuring (search for similar items in EconPapers)
JEL-codes: F34 F41 H63 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:mof:journl:ppr18_01_02

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