IMF paper studies debt sustainability in low-income countries

IMF headquarters in Washington, DC

A working paper, published by the International Monetary Fund in June, examines the effect of the financial crisis on the debt sustainability of low-income countries, finding a short-run impact but projecting a return to a more sustainable level of debt in the longer run.

The authors, Benedicte Baduel and Robert Price, use data from IMF debt sustainability analysis for a sample of low-income countries in 2006, 2008 and 2010. The paper finds favourable growth led to a strengthening of countries'

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