Debt: A Debt Crisis Is Probably Unavoidable in a Bid to Create Jobs

Charlie Robertson ()

A chapter in The Time-Travelling Economist, 2022, pp 161-192 from Springer

Abstract: Abstract By 2025–30, the number of 15–19 year old Africans will exceed the number of young Indians, creating tremendous pressure on governments to “create” jobs via spending. The lack of local savings in high fertility countries incentivises governments to borrow from abroad. We saw this in Latin America in the 1980s (when fertility rates were around four) and in much of Africa and Pakistan today. Unless falling fertility allows countries to replace that external debt with local savings debt default becomes more likely. China and private investors have partly replaced official Western creditors and have quite different views on debt issues. We suggest excess borrowing for transport infrastructure accelerates the risk of default. We outline which countries are most at risk in the 2020s.

Keywords: Debt crisis; Debt; Infrastructure; Railways (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-030-97597-5_4

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DOI: 10.1007/978-3-030-97597-5_4

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