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Government Expenditure Arrears: Securitization and Other Solutions

Alberto Ramos
International Monetary Fund (IMF) - Western Hemisphere Department

May 1998

IMF Working Paper No. 98/70

Abstract:
On occasions, by running arrears, governments have unilaterally borrowed from domestic agents. These agents ended up with implicit claims on the government for which they had no title and that would be honored, at best, on an unspecified future date and for an uncertain value. Having untitled assets limits creditors` financial management capacity, because they cannot trade or enforce these claims. This paper presents several options for addressing the arrears problem. It recommends that the government recognize its implicit financial liabilities, set a timetable for their clearance, and issue market-negotiable titles (securitize). Several country experiences with securitization operations are documented.

Keywords: Government arrears, BRO countries, Securitization, Russia

JEL Classifications: D31, D61, D63, E62

Working Paper Series

Date posted: February 15, 2006 ; Last revised: February 15, 2006

Suggested Citation

Ramos, Alberto, Government Expenditure Arrears: Securitization and Other Solutions (May 1998). IMF Working Paper, Vol. , pp. 1-29, 1998. Available at SSRN: http://ssrn.com/abstract=882348

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Contact Information

Alberto Ramos (Contact Author)

International Monetary Fund (IMF) - Western Hemisphere Department ( email )

700 19th Street NW
Washington, DC 20431
United States