Applying performance bonds to industrial activity
Synonyms: Using commodity indexed bonds
Implementation: In the context of indebted developing countries, instruments such as performance bonds or commodity-indexed bonds can serve as a form of non-interest bearing capital investments. Service is conditional and tied to the debtor's economic growth, or to an export price index for major commodities. Innovations of this sort are unlikely to reduce the debt overhang significantly, but they can be another source of "new money" to stimulate economic growth.
Subjects: Action ApplicationBibliographyCurrencyIndustry Commodities
Type Classification: E: Emanations of other strategies