Sovereign Debt Restructurings in Grenada: Causes, Processes, Outcomes, and Lessons Learned
59 Pages Posted: 5 Sep 2017
Date Written: July 2017
This paper documents the two debt restructurings that Grenada undertook in 2004-06 and 2013-15.Both restructurings emerged as a consequence of weak fiscal and debt situations, whichbecame unsustainable soon after external shocks hit the island economy. The two restructurings provided liquidity relief, with the second one involving a principal haircut. However, the first restructuring was not able to secure long-term debt sustainability. Grenada's restructuring experience shows the importance of (1) establishing appropriate debt restructuring objectives; (2) committing to policy reforms and maintaining ownership of the restructuring goals; and (3) engaging closely and having clear communications with creditors.
Keywords: Grenada, Western Hemisphere, International financial markets, Sovereign Debt; Sovereign Defaults; Sovereign Debt Restructurings; Serial Debt Restructurings; Serial Defaults; Grenada; Disaster Clause, Sovereign Debt, Sovereign Defaults, Sovereign Debt Restructurings, Serial Debt Restructurings, Serial Defaults, Disaster Clause, International Lending and Debt Problems
JEL Classification: F34, G15, H63
Suggested Citation: Suggested Citation