, Volume 15, Issue 6, pp 285–289 | Cite as

Indicator systems for the assessment of the external debt situation of developing countries

  • Rainer Erbe
  • Susanne Schattner
Articles External Indebtedness


The foreign indebtedness of the Third World has been increasing rapidly over the past ten years. The volume of private and public borrowings expanded between the end of 1970 and the end of 1979 from $ 64 bn to $ 376 bn1. This development has quickened the interest in methods for an assessment of the external debt situation of developing countries. Interested parties—commercial banks, international organizations, etc., and the borrowers themselves—are looking for criteria by reference to which they can monitor foreign indebtedness and ascertain in good time whether and when the foreign debt of a country is in danger of reaching “critical” dimensions. What view should be taken of the various criteria?


Early Warning System Indicator System Debt Service Foreign Debt Probability Index 


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  1. 1.
    Cf. World Bank, Annual Report 1980.Google Scholar
  2. 2.
    Dragoslav Avramovic et al.: Economic Growth and External Debt, Baltimore 1964; OECD: Debt Problems of Developing Countries. Paris 1974.Google Scholar
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    Cf., e. g., OECD, ibid., Debt Problems of Developing Countries, Paris 1974. and Avramovic, ibid. et al.: Economic Growth and External Debt, Baltimore 1964;Google Scholar
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    C. R. Frank, W. R. Cline: Measurement of Debt Servicing Capacity: An Application of Discriminant Analysis, in: Journal of International Economics, No. 1, 1971, p. 327 ff.Google Scholar
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    P. D. Dhonte: Describing External Debt Situations: A Roll-Over-Approach, in: IMF Papers, Vol. XXII, No. 1, 1975, p. 519 ff.Google Scholar
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    Cf. Hans J. Petersen: Debt Crisis of Developing Countries: A Pragmatic Approach to an Early Warning System, in: Konjunkturpolitik, 23rd year, 1977, No. 2, p. 94 ff.Google Scholar
  8. 8.
    Hans J. Petersen: Zur Früherkennung kritischer Verschuldungslagen von Entwicklungsländern (On early recognition of critical debt situations of developing countries), in: Vierteljahrshefte zur Wirtschaftsforschung, No. 3, 1977, p. 180 ff.Google Scholar

Copyright information

© HWWA and Springer-Verlag 1980

Authors and Affiliations

  • Rainer Erbe
    • 1
  • Susanne Schattner
    • 1
  1. 1.HWWA-Institut für Wirtschaftsforschung-HamburgHamburg

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