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  5. Emerging Market Sovereign Debt in the Aftermath of the Pandemic

Emerging Market Sovereign Debt in the Aftermath of the Pandemic

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Abstract

For emerging markets, fiscal space is a very real constraint that can surface under a variety of circumstances, including rising world interest rates, falling commodity prices, or a global recession. Some emerging markets, and the majority of low-income developing economies, are already in debt distress or default. Near-term, making sure that troubled debtor countries are aware of the full menu of options, including heterodox strategies such as default, is important. Longer-term, a rethink of the Bretton Woods financial institutions to incorporate a greater emphasis on outright grants instead of loans, makes more sense than ever.

Citation

Rogoff, Kenneth. 2022. "Emerging Market Sovereign Debt in the Aftermath of the Pandemic." Journal of Economic Perspectives, 36 (4): 147-66. DOI: 10.1257/jep.36.4.147

Additional Materials

JEL Classification

  • E23 Macroeconomics: Production
  • E62 Fiscal Policy
  • F34 International Lending and Debt Problems
  • G01 Financial Crises
  • H63 National Debt; Debt Management; Sovereign Debt
  • I12 Health Behavior
  • O23 Fiscal and Monetary Policy in Development
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