Problem

Unbankruptability of sovereign states

Nature:
The international community lacks a legal framework to deal with countries which are unable to continue to service their debts. The loaning institutions are in danger of going bankrupt because of the tendency to continue making loans increasing the level of bad debts. Money and stock markets become more volatile increasing risk. Because their is no way for sovereign borrowers to negotiate a rewriting of contracts, the restructuring of debts is disorderly and unpredictable.
Related UN Sustainable Development Goals:
GOAL 16: Peace and Justice Strong Institutions
Problem Type:
F: Fuzzy exceptional problems
Date of last update
01.01.2000 – 00:00 CET