Sovereign Bilateral Creditor Collaboration Encouraged by IMF

Low-income countries that have built up high levels of debt from non-traditional sources are a growing cause of concern, according to the managing director of the International Monetary Fund, Christine Lagarde, Reuters reports. At a sovereign debt restructuring conference, Lagarde warns that debt restructuring cases with non-traditional lenders are going to require better collaboration. Non-Paris Club providers of credit, like China, often do not have developed guidelines on how to restructure debts. She advised borrowers and their new creditors to be more transparent about their liabilities to prevent debt from spiraling into massive government obligations.

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