Growth and External Debt Management

The decades of the 1950s and 1960s saw a period of global expansion of production and trade, full employment and little inflation in the industrialized countries, conditions which encouraged developing countries to borrow heavily on the world's financial markets. However, the decade of the 1970s saw a breakdown and disintegration in international trade, during which time developing countries continued their growth, even in the face of serious recession. Their investments fell to levels at which even minimal replacement could no longer occur in important sectors of the economy. The editors of this text believe that in some developing countries, the severity of a prolonged economic slump has led to living conditions worse than those of the Great Depression. This volume contains a series of 21 papers presented at the International Conference of Economists, held at the University of Zagreb, Yugoslavia, which had been convened to discuss international debt management policies. The contributors examined policy issues of macro-economic management and offered general and overall approaches to the debt and growth problems of the 1980s. The general consensus of the conference was that the major task of debt management in the 1990s will be to keep the size of debts within serviceable limits, or, if a major financial crisis does occur, to manage it by rescheduling existing debts on concessional terms.

Table of Contents:
Part 1 Growth and debt management: external debt management and economic growth, Soumitra Sharma; external debt management, Mia Mikic; debt globalization for its management, Boguslav Jasinski; management of the Third World debt, Zoran Jasic; the 1980s - a lost decade - development in reverse?, H.W.Singer. Part 2 Some policy issues and models considered: debt, inflation and management, Stephany Griffith-Jones; growth with external debt and inflation, Yasuoki Takagi; fiscal policy, deficits and crowding out, George Macesich; conditionality and adjustment, Hajna Istvanffy Lorinc; agriculture and managing the debt crisis, Vladimir Stipetic; failures of renegotiation process, Carlos A.Roso; an analysis of structural changes in the seven major exchange rates, Tomoki Waragai and Hiroya Akiba; international debt rescheduling and default in a model with implicit contracts, Ronald Schramm; lender paradoxes and the recent turnarounds in international capital markets, Sunanda Sen; sovereign risk quantification methodologies, R.F.K.Wynn; effects of macroeconomic transmission of tariffs, Soren Bo Nielsen; private foreign investment and welfare in LDCs, Monojit Chatterji and Sajal Lahiri. Part 3 Policy effects - case studies: East Europe's debt situation in global perspective - Utopian versus realistic solutions, Paul Marer; trade policy reforms in sub-Saharan Africa, Ravi Gulhati; liberal economic strategy for debt crises management - a case of Turkey, Arif Ersoy; Yugoslav debt crises management, Aleksandar Bogunovic.