The debt problems in Greece and other euro zone countries bring a new urgency to the restructuring debate, underscoring the importance of prevention and management of sovereign debt crises that pose potential threats to international financial stability. In hindsight, many gaps in the financial architecture for debt restructuring are evident from past experiences with sovereign debt crises in emerging markets and other developing countries. While there are valuable lessons to be learned from these experiences, efforts to reform the architecture have been slow and the incremental steps taken have been inadequate in preventing debt crises and providing a timely and cost-effective resolution.
CIGI in partnership with the Financing for Development Office of the United Nations Department of Economic and Social Affairs (FfDO/UNDESA) and the Commonwealth Secretariat are organizing a second Expert Group Meeting on Sovereign Debt Restructuring.
The first expert group meeting was convened in New York on May 18, 2012 to explore concrete, practical steps to improve the framework for the timely and orderly restructuring of sovereign debt. The discussion focused primarily on the major institutional deficiencies of the international financial architecture to manage these debt crises. The purpose of the second meeting held in London is to concentrate on several issues flagged at the meeting in New York. These include the options for establishing structures for creditor committees, contractually defined stays and standstills vis-à-vis statutory “grace periods” and potential debtor-in-possession financing. The overarching discussion of the architecture for sovereign debt restructuring, (including debt sustainability assessment) and tax, regulatory and accounting frameworks will help to foster discussion that draws lessons for dealing with future sovereign debt restructuring, including options for voluntary and statutory approaches. Participants will include experts from international institutions, academia, private sector creditor groups and other market participants.