From Toronto Terms to the Hipc Initiative A Brief History of Debt Relief for Low-Income Countries

29 Pages Posted: 15 Feb 2006

See all articles by Christina Daseking

Christina Daseking

affiliation not provided to SSRN

Robert Powell

University of California, Berkeley

Date Written: October 1999

Abstract

The low-income country debt crisis had its origins in weak macroeconomic policies, and official creditors` willingness to take risks unacceptable to private lenders. Payments problems were initially addressed through nonconcessional reschedulings and new lending that maximized financing while containing the budgetary costs for creditors. This led to an unsustainable buildup in debt stocks. More recently, debt ratios have improved, reflecting both adjustment and substantial debt relief. The paper estimates debt relief initiatives since 1988 have cost creditors at least $30 billion, and possibly much more. This compares with the estimated costs of about $27 billion under the enhanced HIPC Initiative.

Keywords: External Debt HIPCs Low-Income Countries

JEL Classification: H63 F34

Suggested Citation

Daseking, Christina and Powell, Robert, From Toronto Terms to the Hipc Initiative A Brief History of Debt Relief for Low-Income Countries (October 1999). IMF Working Paper No. 99/142, Available at SSRN: https://ssrn.com/abstract=880669

Christina Daseking (Contact Author)

affiliation not provided to SSRN

Robert Powell

University of California, Berkeley ( email )

549 Evans Hall #3880
Berkeley, CA 94720-3880
United States

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