External Debt Crisis of Developing Countries

Abstract

What has come to be known as the external debt problem of developing countries is of relatively recent origin — relative to that of the numerous other issues that have been debated at the United Nations over the last half century. Sometimes the question of debt would be raised in connection with the issue of flow of financial resources to developing countries. The emphasis here would be on the inadequacy of the financial flow, net of the growing debt-servicing liabilities. In course of time, even an ‘inadequate’ inflow of resource swelled the stock of debt, and concern over debt servicing as a problem in itself also increased. That concern was indeed expressed from time to time in the central United Nations policy forums and in secretariat analyses, but nothing seemed to have prepared the organization, or the rest of the world, for the crisis that burst upon the scene in 1982.