Developing Countries’ External Debt and International Financial Integration

FESSUD Working Paper Series, No 121

88 Pages Posted: 26 Jan 2019

See all articles by Bruno Bonizzi

Bruno Bonizzi

University of London - School of Oriental and African Studies (SOAS)

Christina Laskaridis

Open University, UK; SOAS University of London

Jan Toporowski

University of London - School of Oriental and African Studies (SOAS)

Date Written: September 2015

Abstract

This paper assesses the dynamics of developing and emerging countries external debt and financial vulnerability. It is argued that, although current account positions do have a role in accumulating external liabilities, developing countries’ vulnerability primarily lie in their increasing financial integration, which has resulted in the growth of their cross-border assets and liabilities. Rather than government falling into net indebtedness, which actually fell in many countries in recent years, developing countries are now more likely to be hit by financial instabilities originating from private credit and financial markets.

Keywords: developing countries, external debt, debt sustainability, financial integration

JEL Classification: F32, F34, F40

Suggested Citation

Bonizzi, Bruno and Laskaridis, Christina and Toporowski, Jan, Developing Countries’ External Debt and International Financial Integration (September 2015). FESSUD Working Paper Series, No 121, Available at SSRN: https://ssrn.com/abstract=3315871 or http://dx.doi.org/10.2139/ssrn.3315871

Bruno Bonizzi

University of London - School of Oriental and African Studies (SOAS) ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

Christina Laskaridis (Contact Author)

Open University, UK ( email )

Walton Hall
Milton Keynes, Buckinghamshire MK7 6AA
United Kingdom

SOAS University of London ( email )

Thornhaugh Street
Russell Square
London, WC1H 0XG
United Kingdom

Jan Toporowski

University of London - School of Oriental and African Studies (SOAS) ( email )

Thornhaugh Street
Russell Square: College Buildings 541
London, WC1H 0XG
United Kingdom

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