Warning: Creating default object from empty value in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/plugins/independent-core/admin/ReduxCore/inc/class.redux_filesystem.php on line 29 Debt Repudiation – Fincyclopedia
[wpdreams_ajaxsearchpro id=44 ]

International Finance


[addtoany]
Notice: Undefined variable: myString in /hermes/bosnacweb04/bosnacweb04ai/b1550/ipg.lantanasolutionsbh98965/fincyclopedia/wp-content/themes/independent/template-parts/post/content-single.php on line 41

Debt Repudiation


A complete default on debt repayment and service by a debtor nation. This constitutes an outright cancellation of all current and future foreign debt and equity obligations. This sovereign move usually denotes a state bankruptcy. However, it may have some advantages to the defaulting country among which are: (1) Eliminating the need for taxation to finance the debt. (2) Being able to eliminate primary deficits. On the other extreme, the government might not be able to borrow in the future and as such it would be “liquidity constrained” because no country or institution would accept to lend a defaulting nation, at least on the short- to medium term. Examples of countries that repudiated their external debts are China (1949), Cuba (1961), and North Korea (1964).


[related_posts_by_tax title="See also" posts_per_page="10" taxonomies="post_tag"]

[pt_view id=6a2d464dy5]
[su_box title="Watch on Youtube" style="soft" box_color="#f5f5f5" title_color="#282828" radius="2" class="" id=""][su_row class=""][su_column size="1/1" center="yes" class=""] [/su_column][/su_row][/su_box]
Remember to read our privacy policy before submission of your comments or any suggestions. Please keep comments relevant, respectful, and as much concise as possible. By commenting you are required to follow our community guidelines.

Comments


    Leave Your Comment

    Your email address will not be published.*