José Antonio OcampoDuring the 1930s, external debt default opened the space for counter-cyclical macroeconomic policies. In contrast, during the 1980s, Latin America faced strong pressures to avoid prolonged defaults and was forced to adopt contractionary macroeconomic policies. Averting default helped the U.S. avoid a banking crisis, but at the cost of a lost decade of development in Latin America. The Brady Plan came very late, but helped create a market for Latin American bonds. Two basic implications are that there is a need to create an international debt workout mechanism and that international financial institutions should never be used to support the interests of creditor countries.
Remarks by Martín Guzmán at 12th Edition of the Paris Forum: Key findings and conclusions of the Jubilee Report
Dear members of the Paris Club Secretariat, Thank you for the invitation to present some of the key findings and conclusions of the Jubilee Report, commissioned by Pope Francis and prepared by a Commission of
Joseph Stiglitz
Martín Guzmán