Search

Purpose: This paper aims to examine the factors that contribute to the external debt growth in Ghana. Design/methodology/approach: The study adopts the autoregressive distributed lag (ARDL) model and the error correction model (ECM) to establish the short-run and long-run relationships between the dependent variable (external debt) and the independent variables (debt service, exchange rate, gross domestic product, government expenditure, import and trade openness), using a time series data spanning from 1990 to 2019. Findings: The results indicate that debt service, GDP, government expenditure and trade openness have a positive and significant relationship with external debt, while import and exchange rates have a negative relationship with external debt in the long run. In the short run, debt service, import, exchange rate and trade openness have a positive and significant relationship with external debt, while GDP has a negative relationship with external debt. Practical implications: The study found that variables such as government expenditure, debt service and import contribute significantly to the nation's external debt stock. These findings suggest that policymakers should focus on prioritising and cutting down expenditure in their quest to curtail the debt menace facing the nation. Since existing debt service has the tendency of influencing debt stock, it is recommended that government should reduce borrowing in order avoid debt trap. Home-grown policies to reduce imports must also be encouraged. As these drivers of external debt are tackled head-on, Ghana can be rightly positioned to record lower levels of public debt and subsequently reap the benefits of economic growth. Originality/value: The study adds to the public debt literature, specifically addressing the idiosyncratic determinants of external debt within the Ghanaian context. [ABSTRACT FROM AUTHOR]

Copyright of Environmental & Social Management Journal / Revista de Gestão Social e Ambiental is the property of Environmental & Social Management Journal and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

We estimate the causal effect of external debt on greenhouse gas emissions in a panel of 78 emerging market and developing economies over the 1990-2015 period. Unlike previous literature, we use external instruments to address the potential endogeneity in the relationship between external debt and greenhouse gas emissions. Specifically, we use international liquidity shocks as instrumental variables for external debt. We find that dealing with the potential endogeneity problem brings about a positive and statistically significant effect of external debt on greenhouse gas emissions: a 1 percentage point (pp.) rise in external debt as a percentage of GDP causes, on average, a 0.5% increase in greenhouse gas emissions. One possible mechanism of action could be that, as external debt increases, governments are less able to enforce environmental regulations because their main priority is to increase the tax base to pay increasing debt services or because they are captured by the private sector who owns that debt and prevented from tightening such regulations. [ABSTRACT FROM AUTHOR]

The study gives new evidence on the effects of public debt on economic growth in India with key macroeconomic indicators from 1980 to 2019. In the past decade, and after the COVID-19 pandemic, there is a substantial rise in public debt, which reached 90% of the GDP in April 2021. Therefore, it is imperative to study the impact of different public debt sources on the Indian economy to help policymakers frame informed debt management policies. The long-run equilibrium relationship and cointegrating coefficients are calculated using Johansen cointegration and fully modified ordinary least square techniques. Toda and Yamamoto's (1995) Granger causality test is used as a short-run diagnostic test for the long-run equilibrium relationship. The study's major findings suggest that domestic debt, total factor productivity (TFP) and exports are the major determinants of economic development in the long run. In contrast, economic prosperity determines the growth of external debt, debt service payments and TFP in the short run. It is recommended that the government should control and channel public debt productively for favourable growth effects. [ABSTRACT FROM AUTHOR]

This paper examines the possible nonlinear relationship between public debt and income inequality. The literature extensively examines the non-linear growth effects of public debt, whereas its inequality effects are not investigated sufficiently. Public debt can be used to finance distributive policies, thereby improving income equality. However, high public debt levels can also harm economic growth and decrease the fiscal space due to sustainability concerns, high risk premia, and large debt service burden. Hence, it is possible that public debt can have non-linear effects on inequality. The empirical analysis documents that the relationship between public debt and inequality is positive with a declining marginal effect in the case of advanced countries. However, developing countries display a U-shape relationship, implying that public debt is initially associated with declines in inequality, while higher levels of debt are associated with higher levels of inequality. The analysis also shows that the determinants of inequality can differ greatly between advanced and developing countries. [ABSTRACT FROM AUTHOR]

Despite past debt relief initiatives, the external debt of Africa is rising again, and it has some new worrying features: diminishing concessionality and a rising private creditor. Sub-Saharan African countries devote a significant portion of their fiscal resources to service the debt, and this prevents them from increasing development expenditures (generally imports of strategic goods that can't be produced domestically). By adding a human development factor to the Geometry of Debt Sustainability model (GDS) (Vaggi and Prizzon 2014) and following the analytical framework of Pasinetti (1998), we assess how external debt sustainability changes when countries increase the foreign currency purchasing of health and education goods and services. Not only these types of human development expenditures are central to the Sustainable Development Goals (SDGs), but they have become even more important due to impact of the Covid-19 pandemic on many low income countries (LICs). We evaluate external debt sustainability in two African contexts: Kenya and a composite country, called Ubuntu, which is representative of Sub-Saharan Africa average indebtedness conditions. The results confirm the existence of a trade-off between debt service and human development expenditures. Even before the Covid-19 pandemic, the Sub-Saharan African countries were on unsustainable debt trajectories as the debt-to-GDP ratios would stabilize only at extremely high values. [ABSTRACT FROM AUTHOR]

This study investigates the influence of corporate governance mechanisms on debt service obligations within the context of 34 automobile companies listed on the Tokyo Stock Exchange from 2006 to 2021, utilizing a purposive sampling approach. Employing a range of statistical models including the random effect model, fixed effect model, and the generalized method of moments (GMM), the study yields several key findings. Firstly, it reveals a significant and positive correlation between the presence of independent board members and the debt service obligations of Japanese automobile firms. Secondly, a noteworthy negative association is uncovered when the CEO holds a dual role, impacting debt service obligations negatively. Thirdly, the inclusion of non-executive board members on corporate boards is found to be linked to a significant and adverse effect on debt service obligations among these firms. Finally, the study underscores the positive impact of board members' knowledge, skills, and the frequency of meetings on the debt service obligations of automobile companies in Japan. [ABSTRACT FROM AUTHOR]

This study examines the relationship between Zanzibar’s debt service and economic growth (GDP per capita) from 1987 to 2022. Employing a Vector Error Correction Mechanism (VECM) with time series data, we analyze the long-run impact of debt service on growth. While our results show a positive correlation, it’s not statistically significant. This suggests that effective debt management, fostering investor confidence and stability, can potentially stimulate growth. The study emphasizes the importance of balanced debt strategies and informed policymaking for Zanzibar’s sustainable development. It highlights the complexities of debt-growth dynamics, underlining the need for fiscal discipline and prudent debt management for long-term prosperity. This research offers valuable insights for policymakers navigating debt and economic policy in island economies.

The aim of this paper is to analyse the evolution of Spanish households' indebtedness and financial vulnerability over the course of this century using micro-data from the Household Finance and Consumption Survey. Our results show a growing debt participation of Spanish households and an increase in the stock of outstanding debt of indebted households, a trend that reversed with the end of the Great Recession. Moreover, the percentage of financially vulnerable households according to three indicators grew dramatically until the end of the downward phase of the last economic cycle and showed considerable signs of improvement during the second half of 2010s. These results, nonetheless, call attention to the number of Spanish households being unable to service their debts in the face of an economic downturn. [ABSTRACT FROM AUTHOR]

This study investigates the intricate relationship between external debt, debt service, and economic growth by using the panel data of 32 Asian Developing Economies (ADE) spanning 1995 to 2020. Employing a two-step system generalized method of moments (GMM) and a dynamic common correlated estimate (DCCE) model, the research explores key macroeconomic channels through which debt influences growth and rigorously tests for debt overhang and crowding-out effects. Findings reveal that public and private investment, total factor productivity, and national savings are pivotal channels transmitting the non-linear effect of external debt on economic growth. Notably, only private and public investment convey the non-linear effects of debt service to economic growth, while productivity and savings convey the linear effect. Evidence of debt overhang and crowding-out effects is identified in the sampled economies. The study suggests strategic measures for developing countries, emphasizing the productive use of accumulated debt, enhanced debt management, and timely project completion. Furthermore, it advocates for fostering economic growth through increased productivity, domestic savings, and private sector expansion to reduce dependence on foreign debt, facilitating both debt repayment and economic self-sufficiency. Plain language summary: This study explores the intricate links among external debt, debt service, and economic growth in 32 Asian Developing Economies from 1995 to 2020. Using advanced statistical methods like the two-step system generalized method of moments (GMM) and a dynamic common correlated estimate (DCCE) model, the research investigates various macroeconomic pathways, specifically testing for non-linear effects such as debt overhang and crowding-out. Key findings emphasize the significance of public and private investment, total factor productivity, and national savings as pivotal channels for the non-linear impact of external debt on economic growth. Notably, the study reveals that private and public investment exhibit non-linear effects in response to debt service, while productivity and savings show linear effects. The research recommends strategic approaches for developing countries, focusing on judicious debt management, timely project completion, and initiatives to boost productivity, domestic savings, and private sector growth, thereby reducing reliance on foreign debt. Acknowledging valuable insights, the study recognizes limitations in the available data from 32 countries and emphasizes the need for further investigation into mediating and moderating variables in the relationship between external debt and economic growth. Particularly in the context of foreign debt financing policies, the study underscores the importance of exploring threshold values for negative impacts on transmission channels, suggesting avenues for future research to provide a more nuanced understanding of the dynamics involved. In essence, the study offers valuable insights into the nuanced relationship between external debt and economic growth, along with strategic recommendations for sustainable development in developing economies. [ABSTRACT FROM AUTHOR]

Effective movement of financial flows, ability to beforehand service of debt obligations, and creditworthiness of the state are signs of trust for the global financial community and the guarantee of successful cooperation with international financial organizations. The purpose of the article is to indicate the important directions of effective management of state financial flows in the context of strengthening Ukraine's debt and budget security for its sustainable economic development in the international environment. As a result of the assessment of the financial flows of the State Budget of Ukraine during the period of martial law in Ukraine, the growth of budget revenues and expenditures of their main components was revealed. Also, it was accompanied by the growth of the budget deficit and the state debt due to the state borrowing loans to balance the flows of revenues and expenditures. A comparison of the financial flows of Germany, France, and Ukraine showed among the studied countries the highest share of the budget deficit in expenditures in Ukraine. The existence of a budget deficit and a high level of debt burden is the main factor that unbalances the flows of budget revenues and expenditures and complicates the socio-economic situation of Ukraine. Possible directions for improving the effectiveness of Ukraine's debt policy strategy focused on ensuring constant assessment, monitoring and control of indicators of the state's debt and budget security are outlined. Based on the experience of the financial provision of developed countries of the world, directions for improving the management of the movement of state financial flows were proposed. They are based on strengthening control over the effectiveness of managing budget financial flows and implementing innovative budgeting practices aimed at ensuring the economical and reasonable use of budget funds, which will ensure the security of the state in the international economic environment. [ABSTRACT FROM AUTHOR]

Most major industrial economies are projected to see continuing marked increased in government debt over the next several decades, if current policies are continued. This reflects factors such as the aging of populations, coupled with entitlement programs that are not means-tested, the costs of clean-energy investments, and the growing costs of servicing debts. Experience shows that it would be possible to arrest this growth, but it will involve making some painful choices to be made. In the US, projections of debt growth have not worsened in recent years, while earlier upward revisions reflected in large part revenue actions. Despite the voiced concerns, analysis suggests that the crowding out of private investments by the growth of US debt has had, and will continue of have, only modest effects on trend growth and don't point clearly to greater risks of a financial crisis or high inflation. [ABSTRACT FROM AUTHOR]

The US has reached a crisis stage regarding mounting sovereign debt, but a change of mindset and adoption of practical solutions can restore the nation to fiscal health. Unless actions are taken now to change the trajectories, deficits and debt are anticipated to enlarge over the coming decades with an aging population boosting spending, increasing debt service, and insufficient revenues. While there is no silver bullet, there are myriad policy actions that can cut deficits, lower debt to a sustainable level, reduce financial stability risks, and support US economic growth over the long run. Moreover, focusing upon lowering debt over a 20- or 30-year horizon instead of the typical 10-year CBO forecasting period can help rein in federal debt without significant damage to the economy. [ABSTRACT FROM AUTHOR]

In this contribution, I discuss the divergence of German and French public finances over the course of the last two decades. Major gaps in public deficit/debt levels and debt service costs have opened even under the presence of a common fiscal framework at the EU level. To explain these differences, I focus on three elements: the (non-)perception of budgetary and socio-economic crisis, differences in demographic conditions, and contrasting approaches towards the role of rules and expertise in fiscal policymaking. The contribution illustrates these points by providing two concise case studies on key developments in fiscal policymaking and institutions since the 1990s. I conclude with a brief reflection on German and French fiscal policymaking in the years to come. [ABSTRACT FROM AUTHOR]

In order to quantitatively assess the potential effects from the ongoing transformation of the fiscal framework of the European Union, we evaluate the economic and public finance stabilization properties of two benchmark fiscal rules using a New Keynesian small open economy model. If these fiscal rules are implemented one at a time, having just an expenditure growth rule tends to yield more stable macroeconomic outcomes but more volatile public finances, as compared to having only a structural balance rule. Much of the quantitative differences in relative volatilities can be accounted for by using a modified public expenditure definition in the expenditure growth rule, in particular the removal of debt service payments. The expenditure growth rule with a strong-enough debt anchor strikes the balance between the short-term macroeconomic stability and the medium-term public debt convergence. There is a welfare gain for households from having only an expenditure growth rule. [ABSTRACT FROM AUTHOR]

Consider a model of debt management, where a sovereign state trades some bonds to service the debt with a pool of risk-neutral competitive foreign investors. At each time, the government decides which fraction of the gross domestic product (GDP) should be used to repay the debt, and how much to devaluate its currency. Both these operations have the effect to reduce the actual size of the debt, but have a social cost in terms of welfare sustainability. When the debt-to-GDP ratio reaches a given size $ x^* $, bankruptcy instantly occurs. Moreover, at any time the sovereign state can declare bankruptcy by paying a correspondent bankruptcy cost. To offset the possible loss of part of their investment, the foreign investors buy bonds at a discounted price which is not given a priori. This leads to a nonstandard optimal control problem. For a given bankruptcy threshold $ x^* $, we show that the optimization problem admits an equilibrium solution. The paper also studies properties of optimal feedback strategies, and the asymptotic behaviour of the expected total cost to the borrower as $ x^* $ is pushed to infinity. [ABSTRACT FROM AUTHOR]

Economic theory argues that foreign direct investment (FDI) and external debt are expected to enhance economic growth in any given economy. Consequently, this study (i) investigated the relationship between foreign direct investment, external debt servicing, and economic growth in Nigeria; (ii) investigated how foreign direct investment and external debt impact Nigeria's economic growth; and (iii) analyzed the direction of causality among the three macroeconomic variables. Descriptive statistics, time series autoregressive distributive lag, and robust Granger causality tests were adopted as the estimating techniques. The results showed that from 2011 to 2022, Nigeria's FDI continued to decline, Nigeria's external debt servicing continued to grow on an upward trajectory, and the growth of the GDP has been meandering. ARDL analysis results confirmed that the lag of FDI and current exchange rate exert positive effects on current economic growth in Nigeria, with a 1% increase in FDI, current external debt, and current exchange rate increasing growth by 1.49%, 1.58%, and 0.02%, respectively. Results from the Granger causality showed that FDI and external debt do Granger cause GDP in Nigeria. Policymakers should focus on prudent debt management practices and strive to reduce domestic debt levels. [ABSTRACT FROM AUTHOR]

Background: Countries in the Global South are currently facing momentous economic and social challenges, including major debt service problems. As in previous periods of global financial instability, a growing number of countries have turned to the International Monetary Fund (IMF) for financial assistance. The organization has a long track-record of advocating for extensive fiscal consolidation—commonly known as 'austerity'—for its borrowers. However, in recent years, the IMF has announced major initiatives for ensuring that its loans support social spending, thus aiding countries in meeting their development targets and the Sustainable Development Goals. To assess this track record, we collected spending data on 21 loans signed in the 2020–2022 period, including from all their periodic reviews up to August 2023. Results: We find that austerity measures remain a core part of the organization's mandated policies for its borrowers: 15 of the 21 countries studied here experience a decrease in fiscal space over the course of their IMF programs. Against this fiscal backdrop, social spending floors have failed to live up to their promise. There is no streamlined definition of these floors, thus rendering their application haphazard and inconsistent. But even on their own terms, these floors lack ambition: they often do not foresee trajectories of meaningful social spending increases over time, and, when they do, many of these gains are eaten up by soaring inflation. In addition, a third of social spending floors are not implemented—a much lower implementation rate from that for austerity conditions, which the IMF prioritizes. In several instances, where floors are implemented, they are not meaningfully exceeded, thus—in practice—acting as social spending ceilings. Conclusions: The IMF's lending programs are still heavily focused on austerity, and its strategy on social spending has not represented the sea-change that the organization advertised. At best, social spending floors act as damage control for the painful budget cuts: they are instruments of social amelioration, underpinned by principles of targeted assistance for highly disadvantaged groups. Alternative approaches rooted in principles of universalism can be employed to build up durable and resilient social protection systems. [ABSTRACT FROM AUTHOR]

An inquiry into the impact of external and domestic borrowings is considered timely for Nigeria, given the growing public debt profile amid deteriorating human capital development. Using data from 1990 to 2021, the study estimates the effects of domestic and external debts on Nigeria's human capital development. The study employed the fully modified ordinary least squares and canonical cointegration regression as the main estimation technique and the robustness check, respectively. The study discovered that domestic and external debt, economic growth and debt servicing exert positive and significant influence on human capital development in Nigeria while environmental pollution has an inverse and significant impact on human capital development in Nigeria. Premised on the outcomes, policy suggestions aimed at enhancing human capital development in Nigeria have been put forward. [ABSTRACT FROM AUTHOR]

A disordered energy transition might impact borrowers' ability to repay and service debt; this calls for methods for integrating climate into credit risk modelling. This integration is required not only for risk management, but also for adjusting credit ratings for collateral pledged in Eurosystem monetary policy operations. This study introduces an innovative methodology to evaluate Italian non-financial firms' exposure to climate policy risks, gauging the impact of climate policies on firm-level default probability (PD). By simulating a shock to energy expenditure originating from different levels of a carbon tax, we analyze the potential impact on firms' PD. Our method offers a comprehensive understanding of the channels through which energy shocks propagate and their implications on firms' vulnerability. Our findings show that the impact of carbon taxation on credit risk would be contained, raising the average PD by a range of 0.6–4.1 basis points according to the different levels of carbon tax. The effect is slightly larger for the Agriculture and Services sector, while there is no clear pattern relating to firm size. [ABSTRACT FROM AUTHOR]

Copyright of Pacha: Revista de Estudios Contemporáneos del Sur Global is the property of PACHA REVISTA DE ESTUDIOS CONTEMPORANEOS DEL SUR GLOBAL and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Background: Formulation of the problem for this research is, how will the role of intention as a mediating variable and facilities as a moderating variable be able to play a role in influencing perceived control behavior on debt repayment behavior. Purpose: This study empirically investigates the influence of perceived control behavior on debt repayment behavior, debt repayment intentions, and facilities on debt repayment behavior. Design/methodology/approach: Most of the determinants of research variables were developed based on the Theory of Planned Behaviour (TPB). Surveys to 120 people of owned Medium Small Enterprises (MSEs) in the culinary sector who took credit debt from the Wibawa government program in the city of Semarang. Data were analyzed using the structural equation model (SEM PLS). Findings/Result: The results showed perceived control behavior had a positive effect on the intention to repay the debt of MSE owners who took out Wibawa's credit debt. Furthermore, perceived control behavior and debt repayment intention have a positive effect on debt repayment behavior. We found empirical evidence that facilities have a role in strengthening the influence of debt service intentions on debt service behavior. Conclusion: This study enhances the behavioral debt literature by employing more extensive measures to assess perceived control, behavior, and intention, while also introducing the use of facilities as an alternative measure for variables that reinforce behavioral intention. Originality/value (State of the art): The originality lies in its contribution to the existing literature on debt behavior, as it utilizes two dimensions to measure behavior and introduces facilities as a novel reinforcement measure. [ABSTRACT FROM AUTHOR]

This paper qualitatively and quantitatively examines the development of the sovereign debt market in Prewar China under different governments. During the Beijing Era (1912–26), accompanied by the establishment of necessary financial institutions, the sovereign debt market emerged to meet fiscal needs. Surprisingly, the Nationalist government, in power from 1927, successfully cultivated a robust market characterized by its expanding size and liquidity. Setting itself apart from its predecessors, the government established credibility as a borrower in two key ways. Firstly, it demonstrated unwavering commitment to debt service by settling previous debts and offering well‐structured new ones, even during challenging times. Furthermore, the government escrowed fiscal revenue, pledged for debt repayments, to a semi‐independent committee of private bankers on behalf of debtholders, enhancing public confidence. Secondly, the government showcased its ability to secure tax revenues for debt repayments. However, starting from 1931/2, the debt market experienced a decline due to the government's compromised ability to pay resulting from external wars and shifting political priorities that weakened its commitment to debt repayments. Empirical evidence confirms the market's responsiveness to regime shifts and policy changes. This paper sheds light on how a nascent autocratic government can successfully borrow from the public. [ABSTRACT FROM AUTHOR]

Most sovereign defaults are partial, with heterogeneous post-default outcomes, and commodity prices are an important determinant of sovereign default and the subsequent restructurings. In the case of emerging countries, as a result of direct dependence of government on revenues from commodity exports, declines in commodity prices reduce government's resources to service the external debt thereby increase the chances of default. In this paper, we construct a country-specific commodity price index with time-varying weights based on commodity exports to quantify the impact of commodity prices on the partial default rate measured by debt arrears. We show that declines in commodity prices have a significant, positive effect on the default rate. The overall predicted effects for a one-standard deviation decrease in a composite of the level and change of the price index at its 1st, 2nd, and 3rd quartile, on average, are 14.2, 12.5, and 9.3 percentage points respectively. We also show that for a country-specific one-standard deviation decrease in the composite price index, the predicted effect varies from insignificant to an increase of 33.8 percentage points. The country-specific effect on the default rate generally increases in magnitude with a country's dependence on commodity exports, while it depends heterogeneously on external indebtedness—increasing in magnitude for low levels (below a threshold of about 30 percent) of debt and decreasing thereafter. [ABSTRACT FROM AUTHOR]

The current study pursues to examine the impact of external debt servicing on the economic growth of Pakistan, spanning on the period from 1980 to 2022 (years). Time series data required for the study were sourced from the state Bank of Pakistan-SBP and world Development Indicators-WDI. To analyze the long and short term association of the variables GDP growth and external debt servicing, by applying the methodologies of Johansen Co-integration and Vector Error Correction Model (VECM). The econometrics findings approve the expected presence of the long run relationship among the variables, and revealing a negative association of external debt services, Interest rate with GDP growth. It indicates a potential debt-trap situation. Evidently, there is positive association between external debt servicing and gross domestic production in the short run, imputable to the injection of external debt into the economy. This incursion leads to increased investments, heightened economic activities, and a transient boost in GDP. The conflicting results between short and longterm perspectives emphasize the necessity for devising of policy for the policy makers. [ABSTRACT FROM AUTHOR]

The Angola–China connection has famously been branded a 'marriage of convenience'—an 'uneasy alliance' forged for pragmatic reasons at an opportune time of mutual need. In this article, we document how the relationship has more recently undergone a marital burnout of sorts. Chinese loans to Angola have dried up and most Chinese state-owned enterprises have left, as have 90 percent of Chinese migrants. The legacy of this marriage is somewhat mixed. Much of the infrastructure left behind is of dubious quality, while servicing the Chinese debt incurred to finance these projects may consume up to 10 percent of Angola's GDP. Drawing on three rounds of fieldwork in Angola and over 60 interviews, we trace the souring of Angola–China ties to three concomitant factors: (i) Angolan internal politics; (ii) Chinese reconfiguration; and (iii) exogenous shifts in the global economy. In doing so, we argue that China and Angola are entering new territory, and that this shift in both parties' calculations can be usefully illuminated by the concept of 'strategies of extraversion'. Angola's elites have once again proven that they are adept at transforming external constraints—this time related to China's increasing financial caution and domestic recalibration—into new opportunities. [ABSTRACT FROM AUTHOR]

Public-Private Partnerships (PPPs) have been adopted globally to reduce funding gaps amidst an increasing need for public infrastructure. However, they are prone to several risks. Little attention has been paid to this crucial phenomenon in Uganda, despite the rising interest in the use of the PPP model. Through a questionnaire survey with PPP experts in Uganda, 34 principal risks were identified of which the top 10 are construction completion, government corruption, construction cost overrun, land acquisition, delay in project approval and permits, high financing cost, operation cost overrun, inadequate tender competition, procurement risk, and inability to service debt risk. Most of these were found to arise from inadequate experience in PPPs, the complexity of the PPP model, high levels of corruption and the immature domestic financial market. The knowledge of these risks can guide PPP contract negotiations and potential investors in their investment decisions, especially the objective assessment of PPP projects. [ABSTRACT FROM AUTHOR]

The biogas sector in Europe and Italy is attracting growing investment, combining agricultural activity, the circular economy, and renewable energy production. Firms in the sector widely use debt capital and, for this reason, there is a need to evaluate the structure of investments, financing, and debt service capacity calculated by applying interest coverage ratios (ICRs). ICRs are widely used by banks in granting loans, and calculation of ICRs allows managers and policy makers to correctly evaluate firms' performance in the sector. In this research, based on a sample of 160 observations, the structure of investments and sources of financing of firms in the biogas sector, operating in northern Italy, are analyzed. ICRs are calculated with different approaches to establish which ICRs provide the most reliable results in the application. The research analyzes the correlations and highlights significant differences between ICRs. The research highlights some important findings: (a) the NWC is negative in 109 out of 160 observations and, therefore, constitutes a source of financing in the majority of observations; (b) ICRs based on EBITDA and CF are above the threshold value of "1" in 143 and 145 observations, respectively, while ICRs based on EBIT, OCF, and UFCF are above the threshold value of "1" in 132, 133, and 122 observations, respectively. The research allows the conclusion that the ICRs based on EBITDA and CF tend to overestimate results; ICRs based on EBIT, OCF and UFCF are preferable, and can therefore be applied by managers, banks, and policy makers and be used as debt covenants. For the calculation of the repayment of the NFP, the research has highlighted that ICRs in which the cost of the debt is deducted from the numerator are preferable. The research can thus be usefully applied and expanded to other territories, or by considering a larger sample with the aim of inferring conclusions of general validity. [ABSTRACT FROM AUTHOR]

The all-round devastation caused by the COVID-19 pandemic on global economies cannot be over-emphasized. In response to the COVID-19-induced state of economic despondency, many fragile mono-economies/oil-dependent countries resorted to excessive borrowings unilaterally and multilaterally, which consequently plunged them into heavy debts. Against this backdrop, this study investigates the COVID-19 pandemic and debt burden in Africa with special reference to Nigeria. In terms of methodology, the study adopted the case study research design within the explanatory frameworks of Fragile State theory and Debt Overhang theory. It relied heavily on the documentary method for data collection and the content analysis was used for data analysis. The findings revealed that the sudden drop in oil prices at the global market during the COVID-19 pandemic exposed oil-dependent countries to untold economic hardship, pushing them into excessive borrowings as a last resort in mitigating the health and economic crises of COVID-19. The study also observed that due to a lack of financial discipline and poor management of loans, these loans consequently, resulted in an exponential rise in the debt profile and debt burdens in Africa, especially Nigeria. Thus, we recommend that, as Nigeria was hard hit economically by the COVID-19 effect due to overdependence on oil, the government should diversify the economy to ensure the generation of internal revenue for development. Also, African and Nigerian policymakers should imbibe the culture of financial discipline for effective/efficient management of loans and debt servicing. [ABSTRACT FROM AUTHOR]

In this paper, we provide an in-depth overview of key macroprudential policy framework instruments and borrower-based analytical tools in Kazakhstan. We estimate the debt service-to-income ratio (DSTI) for household sector in Kazakhstan for the period between 2013Q2 and 2022Q1. We use the actual remaining maturity and the interest rate for each loan available from the micro-level database (credit registry), and also assume gradual repayment of debt over the time of its remaining maturity. In addition, we specify four types of aggregate income in Kazakhstan. We conjecture, that measuring DSTI with household disposable income approach is likely to provide an upper bound estimate, while calculating debt service-to-income ratio adjusting for the average monthly nominal salary per one employee will likely provide a lower bound assessment. [ABSTRACT FROM AUTHOR]

Copyright of Revista de Historia Económica / Journal of Iberian & Latin American Economic History is the property of Cambridge University Press and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Since the first days of Russia's invasion, the European Union has been supporting Ukraine in the humanitarian, economic, military and financial spheres. The purpose of the article is to trace the changes in the conditions for the use of funds raised by the EU in the financial market and provided to Ukraine during the first years of the war under macro-financial assistance programmes (Emergency, Exceptional, Plus), as well as the recently approved Extended Fund Facility for Ukraine. Methodology. The study is based on a comparative analysis of two interrelated attributes: EU loans and grants provided to Ukraine during the full-scale war, and the design of EU bonds issued in 2022-2024. The results of the analysis show that (i) the fundamental differences from previous EU loans to Ukraine are the increase in the volume and maturity of loans and grants, accompanied by the EU assuming responsibility for debt servicing, which reduces these costs for Ukraine to zero; (ii) two modifications were identified in the way funds are raised: (1) in the financing strategy (from back-to-back to a diversified and unified financing strategy) and (2) in the risk management tools and procedures necessary to protect EU bondholders. Overall, all the changes discussed contributed to the creation of a flexible financial instrument adapted to the challenges of supporting a country at war, while ensuring predictability and accountability of the use of funds. Practical implications. The results of the analysis could help to increase the confidence of (i) EU bondholders in the safety of their securities and (ii) investors in Ukraine in the prospects of participating in Ukraine's recovery. Value/Originality. Given that the events are happening in real time, as far as the authors know, there is no published research on this topic.

This article by Fukunari Kimura discusses Sri Lanka's sovereign debt crisis during the COVID-19 period. The paper highlights the chronic twin debt problem and the relative shrinkage of the tradable sector as key factors contributing to the crisis. It also examines the government fiscal balance, the structure of public external debt, and the anti-trade biases in policies. The author argues that regaining policy discipline and removing anti-trade policies are necessary for resolving the crisis. The paper emphasizes that the crisis was not solely caused by COVID-19 but was a result of long-term mismanagement of public external debt. [Extracted from the article]

Economic growth, is a global issue that Nigeria is still contending with. This global phenomenon however, is plagued by twin evil called debt and debt servicing. Though debt and debt servicing is not bad in itself, but the management in Nigeria seems to hinder economic growth. This concern has prompted the need for this research to examine the effect of debt servicing on economic growth in Nigeria. Therefore, the specific objectives of this study are; to determine the effect of foreign debt servicing on GDP, and to examine the effect of domestic debt servicing on GDP. Two null hypothesis were tested to provide answers to the concerns posed by the independent variables on the dependent variable, ordinary least square regression was adopted, with the aid of SPSS to analyses our result. with GDP as the dimension for the dependent variable, the research period covered was 2005-2021. This research adopted ex-post facto design, because of the nature of data that is analysed. The choice of this design was due to the desire of the researchers to ensure a free interface of the data without manipulation. However, the findings revealed that both Foreign Debt Servicing and Domestic Debt Servicing have significant effect on GDP. We, therefore, conclude that debt servicing in Nigeria should be managed with utmost sincerity to stimulate economic growth. Suffice it to say that, domestic and foreign debt servicing has become obscenity rather than a blessing to the Nigerian economy, as it has not proven to salvage the economic woes of the Nigeria. We recommend accordingly that, Domestic and foreign debt servicing payments should be managed in such a manner that it would not hinder economic growth of Nigeria. [ABSTRACT FROM AUTHOR]

Copyright of Exacta is the property of Exacta - Engenharia de Producao and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)