African debt restructuring.
With debt burdens approaching or already at critical levels in many countries -- and with greater diversity in the makeup of African creditors -- attention is turning towards the risks for orderly debt resolution in the event of new crises. The lengthy and acrimonious restructuring proceedings in Mozambique and the Republic of the Congo are already deterring other countries from entering restructuring agreements, even in the face of severe budgetary constraints.
Removing plans to pay Mozambican bondholders a portion of LNG revenues would dampen some public criticism over repaying contested debts.
IMF deals in crisis states now require heavy governance reforms, but these are unlikely to stick given the poor durability of Fund reforms.
China’s long-mooted Paris Club membership could increase compliance with restructuring terms and unlock more debt relief.
