Financial crisis: Approaches to prevent and resolve new debt crises in low income countries

The project addressed the consequences of the financial crisis on the debt levels in low income countries and potential instruments to prevent and resolve debt crises in low income countries.


Project Team:
Kathrin Berensmann

Time frame:
2009 - 2010 / completed

Project description

The current global financial crisis has jeopardised the external debt positions of various low income countries (LICs) because revenues from exports and growth rates have been declined. In addition, remittances as a major source of external financing have decreased and FDI to LICs have also fallen. Some LICs might not be able to close this financial gap with their own resources and have therefore to resort to higher external borrowing.

This project will deal with the following questions:

  • What are the consequences of the financial crisis on the debt levels in low income countries?
  • Which instruments can prevent and resolve debt crises in low income countries?