Abstract
The last decade has witnessed the exponential escalation of the external debt of developing countries to alarming levels, which constitute a serious problem for the international financial system. During the 1980s there has been a sharp increase in the number of defaults by developing countries and rescheduling exercises, involving both private and official creditors. Rescheduling debts has been by negotiations, which in many instances have been acrimonious affairs in which the debtors have had limited bargaining power, indeed, the only leverage has been that derived from default. This raises the crucially important issue of the use of default by an individual country as a tactic in debt rescheduling negotiations.
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Notes
Richard L. Bernal, ‘Transnational Banks, the International Monetary Fund and External Debt of Developing Countries’, Social and Economic Studies, Vol. 31, No. 4, 1982, pp. 85–8.
Christopher Elias, The Dollar Barons ( New York: Macmillan, 1973 ).
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George R. Delaume, ‘Special Risk and Remedies of International Foreign Loans’, footnote 19, p. 98 in D. Suratager (ed.) Default and Rescheduling: Corporate and Sovereign Borrowing ( London: Euromoney Publications, 1984 ).
William Tudor John, ‘Sovereign Immunity’, in Lars Kalderen and Qamar S. Siddiqi (eds) Sovereign Borrowers, Guidelines on Legal negotiations with Commercial Lenders ( Uppsala: Dag Hammarskjold Foundation, 1984 ) pp. 144–55.
Richard S. Weinert, ‘The Rescheduling of Nicaragua’s External Debt’, in D. Suratgar (ed.) Default and Rescheduling: Corporate and Sovereign Borrowing (London: Euromoney Publications, 1984)
Richard S. Weinert, and Nicaragua’s Debt Renegotiation’, Cambridge Journal of Economics, Vol. 5, No. 2, 1981, pp. 187–94.
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© 1988 Antonio Jorge and Jorge Salazar-Carrillo
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Bernal, R.L. (1988). Default as a Negotiating Tactic in Debt Rescheduling Strategies of Developing Countries: A Preliminary Note. In: Jorge, A., Salazar-Carrillo, J. (eds) Foreign Investment, Debt and Economic Growth in Latin America. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-08311-4_6
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DOI: https://doi.org/10.1007/978-1-349-08311-4_6
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