Policy proposal trends in sovereign debt restructuring

Abstract

ABSTRACT Possible reform of the global sovereign debt management framework is continuously discussed among the members of the policymaking community. After the evaporating Washington Consensus, several reform proposals were made. Some of them were realised, and others remained on paper. The area received new impulses after the Financial Crisis in 2008, mainly due to the European sovereign debt problems. Many of these suggestions were later forgotten. The worldwide fiscal stimuli caused by the COVID-19 pandemic in 2020 and the rapidly deteriorating sovereign debt situation induced another plethora of policy proposals. Some are novelties, but most are revised versions of the old ideas. The study aims to synthesise the old and newer suggestions, identifying current policy trends. The conclusion: the contractual approach still dominates the field, although there are also some feasible statutory-based ideas.