Crisis? What Crisis?

Orderly Workouts for Sovereign Debtors

Barry Eichgreen, et al., Richard Portes
Release Date: October 1, 1995

The Mexican Crisis of 1994/5 came as a rude surprise to the international policy-making community. It revealed serious confusion over how markets, governments, and multilateral institutions like the International Monetary Fund should deal with financial crises in heavily-indebted developing economies. It laid bare a remarkable lack of planning for financial crises in today’s world of globalized bond and equity markets. This report analyses various approaches to coping better with Mexico-style crises.