Furthering International Co-Operation Regarding the External Debt Problems

A/RES/42/198No PDF available

Who created this mandate?

A Resolution of the General Assembly, under agenda item 85External debt crisis and development, published in 1988.

What subjects does this mandate have?

14 topics

Africa Commercial Banks Debt Restructuring Debt Servicing Developing Countries Development Assistance External Debt Financial Flows Groups of Experts Interdependence International Financial Institutions International Trade Least Developed Countries Structural Adjustment

What does this mandate say?

21 operative paragraphs

Endorses the policies and measures agreed upon and spelt out in section II.A of the Final Act adopted by the United Nations Conference on Trade and Development at its seventh session,2 entitled "Resources for development, including financial and related monetary questions";

Expresses concern that external debt problems can pose a threat to economic, social and political stability in indebted countries;

Stresses that debtor developing countries, creditor developed countries and international private and multilateral financial institutions should strengthen work on an evolving and growthand development-oriented strategy, through continuous dialogue and shared responsibility, in order to attain a durable, equitable and mutually agreed solution to debt problems;

Reiterates that specific measures to deal with the indebtedness of developing countries should pay particular regard to the relevant factors of the debt-servicing capacity of each individual country;

Also reiterates that, in the present circumstances, adjustment efforts are needed on the part of all countries, collectively and individually, each country contributing to the common objective in accordance with its capacities and weight in the world economy;

Reiterates that it is essential for the international economic environment to be made more stable and predictable in support of growth through efforts by the major market economy countries, including strengthened multilateral surveillance, aimed at correcting existing external and fiscal imbalances, promoting non-inflationary sustainable growth, lowering real rates of interest and making exchange rates more stable and markets more accessible;

Further reiterates that it is essential for debtor developing countries to pursue and intensify their efforts to increase savings and investment, reduce inflation and improve efficiency, taking into account their own individual characteristics and the vulnerability of the poorer strata;

Reiterates that it is essential that external financing from official and private sources be increased on appropriate terms and conditions in support of these efforts;

Recognizes the competence of multilateral financial institutions and the need for providing them with the adequate resources and instruments necessary, inter alia, to strengthen their contribution to attaining a durable, equitable and mutually agreed solution to the debt problems and, in this context, takes note with interest of:

The agreement on a substantial general capital increase for the World Bank;

The initiative by the Managing Director of the In- (b) ternational Monetary Fund to increase substantially the resources of the Structural Adjustment Facility;

The work towards an increase of quotas in the context of the Ninth General Review of Quotas in the International Monetary Fund;

The proposal to enlarge the scope of the Compensatory Financing Facility by the creation of a new external contingency facility;

The ongoing examination of adjustment programmes and their supportive arrangements, including a comprehensive review of conditionality in the International Monetary Fund;

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Stresses that increased flexibility should be applied by the parties concerned in the development of innovative approaches to reduce the debt burden of developing countries, including, as appropriate, the identification of possible regulatory impediments, and that measures such as the introduction of various forms of new financial instruments and of formulas that do not add to the stock of debt, including those devised by banks and debtors to take advantage of discounts prevailing in the secondary market, should be further pursued, and emphasizes that banks should be encouraged to co-operate flexibly with debtor countries according to individual circumstances to achieve this end;

Calls upon the international community to continue its efforts, in the context of official debt restructuring exercises, to take appropriate and realistic measures to reduce the burden of official debt, adapted to the specific needs and circumstances of individual countries, inter alia, so as to allow an adequate planning horizon and longterm adjustment; consideration should be given to unforeseen changes in a country's external payments;

Urges the international community to give serious consideration to mutually agreed ways and means of assisting debtor developing countries faced with large and bunched debts to the multilateral financial institutions,

taking into account the need for increased capital flows on terms adapted to their payment situation and the specific economic circumstances of individual countries;

Calls upon the international community to intensify its efforts to provide the necessary resource flows to African countries, including increasing official development assistance in support of their reform efforts, and to continue its efforts to grant adequate terms of rescheduling and other effective debt relief measures, as appropriate, to alleviate the debt burden;

Stresses that urgent specific actions in respect of the indebtedness of the least developed and poorest developing countries are required, as contained in the relevant provisions of the Final Act adopted by the the United Nations Conference on Trade and Development at its seventh session, including substantial increases of concessional finance, essentially in grant form;

Recognizes that the problems of external indebtedness of some other countries with serious debt-servicing problems also give rise to concern, and invites all those involved to take into account, as appropriate, the above in addressing these problems;

Stresses the importance of the expansion of world trade and the promotion of a climate conducive to the strengthening of an open and liberalized trading system, including, in particular, the improvement of market access for developing countries' exports, and, in this context, stresses the importance of ensuring effective observance of standstill and rollback commitments and the importance of promoting improved commodity markets;

Requests the Secretary-General, in preparing the agenda for the next session of the Administrative Committee on Co-ordination, to propose that due priority be given to the consideration of the issue of the external debt crisis and development in the Committee's discussions of the international economic situation;

Requests the Secretary-General to consult with the relevant bodies and eminent personalities to prepare a comprehensive report on the international debt situation, reviewing also ways and means of advancing the efforts towards finding a durable, equitable and mutually agreed solution to the debt problems of developing countries in the light of the relevant provisions of the Final Act

adopted by the United Nations Conference on Trade and Development at its seventh session and of the present resolution, to be submitted to the General Assembly at its forty-third session.

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