A principled approach to domestic debt restructuring

This briefing note provides guidance for finance ministers of debtor countries participating in the Global Sovereign Debt Roundtable (GSDR). It argues for the establishment of guiding principles for domestic debt restructuring (DDR) to ensure that long-term economic growth and poverty reduction are prioritized and that the burden of adjustment is shared fairly between domestic and foreign creditors.

• Domestic debt restructuring (DDR) currently lacks a practical guide, consensus on parameters, or established guiding principles, which often allows political influence—frequently from foreign creditors—to dominate the process.
• The author proposes that DDR should be integrated into domestic adjustment programs with the same level of ownership and consultation as other policies, while remaining a separate process from external restructuring.
• The implementation of DDR should be based on a comprehensive cost-benefit analysis regarding the distribution of losses and must be anchored in Debt Sustainability Analyses.
• The Global Sovereign Debt Roundtable (GSDR), established in early 2023 by the IMF, the World Bank, and the Indian G20 presidency, serves as an ad-hoc platform for political and technical discussions on debt restructuring involving Paris Club and non-Paris Club members, private sector representatives, and six borrowing countries.

APA

Moors, R. (2023). A principled approach to domestic debt restructuring. African Center for Economic Transformation. https://acetforafrica.org/research-and-analysis/insights-ideas/articles/a-principled-approach-to-domestic-debt-restructuring/

Chicago

Moors, Rik. A principled approach to domestic debt restructuring. African Center for Economic Transformation, 2023. https://acetforafrica.org/research-and-analysis/insights-ideas/articles/a-principled-approach-to-domestic-debt-restructuring/.

Wikipedia

{{cite report |last1=Moors |first1=Rik |title=A principled approach to domestic debt restructuring |publisher=African Center for Economic Transformation |date=12 October 2023 |url=https://acetforafrica.org/research-and-analysis/insights-ideas/articles/a-principled-approach-to-domestic-debt-restructuring/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{moors2023principled, author = {Moors, Rik}, title = {{A principled approach to domestic debt restructuring}}, institution = {African Center for Economic Transformation}, year = {2023}, month = oct, url = {https://acetforafrica.org/research-and-analysis/insights-ideas/articles/a-principled-approach-to-domestic-debt-restructuring/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }