External Debt Sustainability in Hipc Completion Point Countries: An Update
21 Pages Posted: 30 Jun 2009
Date Written: June 2009
Despite substantial debt relief to HIPC Initiative completion point countries, long-term debt sustainability remains a challenge. This paper examines a number of structural factors affecting external debt sustainability. It shows that in HIPC completion point countries (i) the export base broadly remains narrow; (ii) fiscal revenue mobilization lags behind in some countries; and (iii) policy and institutional frameworks are still relatively weak. Achieving and maintaining longterm debt sustainability in completion point countries will require continued structural reforms, timely donor support, and close monitoring of new non-concessional borrowing.
Keywords: Cross country analysis, Debt sustainability, Export diversification, External debt, Fiscal policy, Fiscal reforms, Governance, HIPC Initiative, Low-income developing countries, Revenue mobilization
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