External Debt Crisis and Development

A/RES/58/203No PDF available

Who created this mandate?

A Resolution of the General Assembly, under agenda item 91eExternal debt crisis and development, published in 2004.

What other versions does this mandate have?

4 versions · 2004–2007

This is an older version — the most recent is A/RES/61/188

2007A/RES/61/188External debt crisis and developmentLatestCompare with previous version
2006A/RES/60/187External debt crisis and developmentCompare with previous version
2005A/RES/59/223External debt crisis and developmentCompare with previous version
2004A/RES/58/203External debt crisis and development

Versions are identified automatically by matching titles within the same organ (~97% accuracy on a manual audit).

Which reports were submitted under this mandate?

1 report of the Secretary-General submitted under this mandate, 2004.

2004A/59/219External debt crisis and development report of the Secretary-General

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What does this mandate say?

29 operative paragraphs

Takes note of the report of the Secretary-General;

Reaffirms the determination, as expressed in the United Nations Millennium Declaration,1 to deal comprehensively and effectively with the debt problems of low- and middle-income developing countries, through various national and international measures designed to make their debt sustainable in the long term;

Emphasizes that the international financial system, along with enhanced official and private external financing and foreign direct investment, are key elements for a durable solution to the external debt problems of developing countries;

Stresses that sustainable debt financing is an important element for mobilizing resources for public and private investment, and that national comprehensive strategies to monitor and manage the external liabilities embedded in the domestic preconditions for debt sustainability, including sound macroeconomic policies and public resource management, are a key element in reducing national vulnerabilities;

Welcomes the World Trade Organization Working Group on Trade, Debt and Finance and its mandate to examine the relationship between trade, debt and finance so as to enhance the capacity of the multilateral trading system to contribute to a durable solution to the problem of external indebtedness of the developing and least developed countries, and to strengthen the coherence of international trade and financial policies, with a view to safeguarding the multilateral trading system from the effects of financial and monetary instability, and takes note of its report of 11 July 2003 to the General Council of the World Trade Organization;

Recognizes that creditors and debtors must share the responsibility for preventing and resolving unsustainable debt situations and that debt relief can play a key role in liberating resources that should be directed towards activities consistent with attaining poverty eradication, sustainable economic growth and sustainable development and with the achievement of the internationally agreed development goals, including those contained in the Millennium Declaration, and in this regard urges countries to direct those resources freed through debt relief, in particular through debt cancellation and reduction, towards these objectives;

Stresses that debt sustainability depends upon a confluence of many factors at the international and national levels, underscores that no single indicator should be used to make definitive judgements about debt sustainability, and emphasizes that country circumstances should be taken into account;

Recalls the call upon industrialized countries, as expressed in the Millennium Declaration, to implement the enhanced programme of debt relief for the heavily indebted poor countries without further delay and to agree to cancel all official bilateral debts of those countries in return for their making demonstrable commitments to poverty reduction, and in this regard welcomes the decision of those countries that have already taken action to do so, emphasizing that debt relief complementary to the framework should be treated as additional;

Calls upon those heavily indebted poor countries that have not already done so, to take, as soon as possible, the policy measures necessary to become eligible for the enhanced Heavily Indebted Poor Countries Initiative and to reach the decision point, inter alia, through the formulation of poverty reduction strategies, where they exist;

Stresses the need to pursue, where appropriate, debt relief measures vigorously and expeditiously, by all creditors, including within the Paris and London Clubs and other relevant forums, and welcomes other bilateral initiatives that have been undertaken to reduce outstanding indebtedness, so as to contribute to debt sustainability and facilitate sustainable development;

Calls upon the international community, including the United Nations system, and invites the Bretton Woods institutions as well as the private sector to take appropriate measures and actions for the implementation of the commitments, agreements and decisions of the major United Nations conferences and summits, in particular those relating to the question of the external debt problem of developing countries, and in this regard stresses the need:

To implement speedily, effectively and fully the enhanced Heavily Indebted Poor Countries Initiative, which should be fully financed through additional resources, while stressing the need for fair, equitable and transparent burden-sharing among the international public creditor community and other donor countries, and take into consideration, as appropriate, measures to address any fundamental changes in the economic circumstances of those developing countries that have an unsustainable debt burden, including those caused by natural catastrophes, severe terms-of-trade shocks or conflict, taking into account initiatives that have been undertaken to reduce outstanding indebtedness;

To continue to bring about a sustained commitment on the part of the heavily indebted poor countries to improvements in domestic policies and economic management, to support capacity-building for the management of financial assets and liabilities, to ensure full participation and delivery of relief by all affected creditors, to ensure adequate and sufficiently concessional financing by international financing institutions and the donor community, and to further explore options to address the difficult issues of HIPC-to-HIPC debt relief and creditor litigation;

To continue to bring together international debtors and creditors in relevant international forums to restructure unsustainable debt in a timely and efficient manner, taking into account the need to involve the private sector in the resolution of crises;

To acknowledge the problems of the debt sustainability of some low-income countries that are not heavily indebted, in particular those facing exceptional circumstances, and in this regard to note the tailored treatment for non-HIPC developing debtor countries adopted by the Paris Club to ensure that debt restructuring provides non-HIPC debtor countries with a debt treatment that reflects their financial needs and the objective of ensuring long-lasting debt sustainability;

To reduce the unsustainable debt burden of developing countries through such actions as debt relief and, as appropriate, debt cancellation and other innovative mechanisms geared to comprehensively addressing the debt problems of developing countries, in particular the poorest and most heavily indebted ones;

To encourage exploring innovative mechanisms to comprehensively address the debt problems of developing countries, including middle-income countries, and countries with economies in transition; such mechanisms may include debt-for-sustainable-development swaps, or multi-creditor debt swap arrangements, as appropriate;

To establish effective debt-tracking mechanisms in developing countries and strengthen technical assistance for external debt management and debt tracking, including through enhanced cooperation and coordination between organizations providing assistance in this regard;

To take steps to ensure that resources provided for debt relief do not detract from official development assistance resources intended to be available for developing countries and that the debt-relief arrangements seek to avoid imposing any unfair burden on other developing countries;

To welcome consideration by all relevant stakeholders of an international debt-work-out mechanism, in the appropriate forums, the adoption of which should not preclude emergency financing in times of crisis, to promote fair burden-sharing and minimize moral hazard, which will engage debtors and creditors to come together to restructure unsustainable debts in a timely and efficient manner;

To establish a set of clear principles for the management and resolution of financial crises that provide for fair burden-sharing between the public and private sectors and among debtors, creditors and investors, while recognizing that a flexible mix of instruments is needed to respond appropriately to the varying economic circumstances and capacities of different countries;

Stresses the importance of continued flexibility with regard to the eligibility criteria for the enhanced Heavily Indebted Poor Countries Initiative, in particular for countries in post-conflict situations, and the need to keep the computational procedures and assumptions underlying debt sustainability analysis under review;

Emphasizes the need to help bring about initial recovery in heavily indebted poor post-conflict countries, in coordination with the international financial institutions, to help clear, as appropriate, the arrears of those countries vis-à-vis international financial institutions;

Reaffirms that reviews of debt sustainability should also bear in mind the impact of debt relief on progress towards the achievement of the development goals set out in the Millennium Declaration and the fact that debt sustainability analysis at the completion point needs to take into account any change in the global growth prospects or in the terms of trade, especially for commodity export developing countries;

Notes that it is important for the International Monetary Fund and the World Bank to continue their efforts to strengthen the transparency and integrity of debt sustainability analysis and to consider any fundamental changes in countries’ debt sustainability caused by natural catastrophes, severe terms-of-trade shocks or conflict when making policy recommendations, including for debt relief, as appropriate;

Stresses the need to strengthen the institutional capacity of developing countries in debt management, calls upon the international community to support the efforts made towards this end, and in this regard stresses the importance of such initiatives as the Debt Management and Financial Analysis System, the International Monetary Fund and World Bank guidelines for public debt management, and the debt-management capacity-building programme;

Invites the United Nations Conference on Trade and Development, the International Monetary Fund and the World Bank, in cooperation with the regional banks, regional commissions and multilateral institutions, to study the possibility of creating a consultative group on external debt management aimed at developing best practices and strengthening the institutional capacity of developing countries in debt management, taking into account work that has already been done;

Requests the Secretary-General to submit to the General Assembly at its fifty-ninth session a report on the implementation of the present resolution and to include in that report a comprehensive and substantive analysis of the external debt and debt-servicing problems of developing countries, inter alia, those resulting from global financial instability;

Decides to include in the provisional agenda of its fifty-ninth session, under the item entitled “Macroeconomic policy questions”, the sub-item entitled “External debt crisis and development”.

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External Debt Crisis and Development

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