Sovereign Debt Crises as Threats to the Peace: Restructuring Under Chapter VII of the UN Charter?

Goettingen Journal of International Law, 2012, vol. 4, pp. 153-175

23 Pages Posted: 8 Nov 2011 Last revised: 6 May 2012

See all articles by Matthias Goldmann

Matthias Goldmann

Max Planck Institute for Comparative Public Law and International Law; Goethe University Frankfurt - Research Center SAFE; Goethe University Frankfurt - Cluster of Excellence Normative Orders; Goethe University Frankfurt

Date Written: March 18, 2012

Abstract

Recently, a growing amount of data suggests that there is an intricate relationship between sovereign debt and civil unrest. This article proposes that the powers of the UN Security Council, and in particular its experience with the imposition of sanctions, should be used in order to restructure sovereign debt before a situation aggravates and leads to the outbreak of civil unrest or an armed conflict. The proposal entails some intricate legal questions. First, it requires a reconsideration of Article 39 of the UN Charter, the threshold for the power of the Security Council to adopt binding resolutions. Second, conflicts of competence might arise between the Security Council and the International Monetary Fund (IMF). Third, the rights of the holders of sovereign bonds need to be respected.

Keywords: Sovereign debt, armed conflict, restructuring, united nations security council, holdout, peace

JEL Classification: F53, H56, H63, H81, H87

Suggested Citation

Goldmann, Matthias, Sovereign Debt Crises as Threats to the Peace: Restructuring Under Chapter VII of the UN Charter? (March 18, 2012). Goettingen Journal of International Law, 2012, vol. 4, pp. 153-175. Available at SSRN: https://ssrn.com/abstract=1956521

Matthias Goldmann (Contact Author)

Max Planck Institute for Comparative Public Law and International Law ( email )

Im Neuenheimer Feld 535
69120 Heidelberg, 69120
Germany

HOME PAGE: http://www.mpil.de/ww/en/pub/organization/scientific_staff/mgoldman.cfm

Goethe University Frankfurt - Research Center SAFE

House of Finance
Theodor-W.-Adorno-Platz 3
Frankfurt am Main, 60323
Germany

HOME PAGE: http://www.safe-frankfurt.de

Goethe University Frankfurt - Cluster of Excellence Normative Orders ( email )

Germany

Goethe University Frankfurt ( email )

Theodor-W.-Adorno-Platz 3
HoF H4
Frankfurt, 60629
Germany

HOME PAGE: http://https://www.jura.uni-frankfurt.de/62222403/Goldmann

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