Sovereign debt (re)structuring-Where do we stand?

Argentina’s debt default in 2001 moved the international community to launch initiatives to develop procedures for the orderly restructuring of unsustainable sovereign debt. These initiatives come against the backdrop of the increase in public debt in emerging market economies over the last decade, of large-scale fi nancial crises linked to the level or structure of sovereign debt and, a recent development, of several cases of sovereign default on international bonds. These developments pose two challenges. Firstly, the complexity of sovereign debt dynamics makes it necessary to strengthen international institutions’ assessment capacity. The International Monetary Fund (IMF) has thus launched initiatives to improve the assessment of debt sustainability and balance sheet weaknesses. Secondly, the developments have prompted the re-examination of IMF facilities for managing debt crises. The absence of a clear framework in this area could create a moral hazard risk, as the international community could be tempted to avoid necessary restructuring by granting substantial fi nancial assistance. In practice, defining such a framework is complex, given that reforms in the area of restructuring influence the way in which debts are structured. In fact, the features of sovereign debt aim to reconcile two requirements: first, ensuring that the sovereign debtor honours the terms of the debt contract if it has the means to do so (ex ante efficiency); second, making sure that the cost of default is not excessive when the sovereign debtor is effectively unable to pay back (ex post effi ciency). The international community currently favours a market-based approach. Its first pillar is a result of the development and spread of collective action clauses (CAC), following the Quarles Report by the Group of 10. Incorporated into debt contracts, CAC aim to reduce the problems arising in inter-creditor co-ordination, by defi ning, in advance, the decision rules applicable in the event of re-negotiation. The “Principles for Stable Capital Flows and Fair Debt Restructuring in Emerging Markets”, whose defi nition was fostered notably by the Governor of the Banque de France and the Group of 20, form the second pillar. They supply guidelines for the parties involved to steer the exchange of information and facilitate co-ordination between debtors and creditors. The market-based approach is not exclusive of a formal regime, e.g. the IMF’s Sovereign Debt Restructuring Mechanism (SDRM), where such a regime is feasible. In the market-based approach, the IMF acts as an expert via the supply of information and analyses, and also as a “monitor” via the negotiation and monitoring of programmes. The provision of loans, which is in principle limited, aims mainly to facilitate renegotiation by giving credibility to the sovereign’s policy. By contrast, a more formal regime would suppose limiting IMF involvement, so as to guarantee the independence of the mechanism. Whatever the case, the efficiency of the overhauled restructuring framework, which is built on contractual provisions and general principles rather than on a formal regime, will depend on the Fund’s capacity to fully perform its three functions.

DCP-collected absolute target reflectance signatures assist accurate interpretation of ERTS-1 imagery

Data collection platforms (DCP's) are being used at a Black Hills, South Dakota, test site (MMC 226A) to record radiometric measurements needed to determine solar and atmospheric parameters that affect ERTS-1 multispectral scanner radiance measurements. A total of 72 channels of analog data transmitted from an unattended ground truth site via three DCP's at least six times a day. The system has operated with only minor problems since September, sending forth daily measurements of biophysical responses and atmospheric conditions. Comparisons of scene radiance data calculated from ERTS images with that measured on the ground show the image-measured values to be 35 percent higher for the green channel and 20 percent higher for the red channel for the same scene targets. Radiance values for channels 6 and 7 are nearly the same from the ground data and from the imagery

Towards a voluntary Code of good conduct for Sovereign Debt Restructuring.

The experience of sovereign debt crises in the 1980s and the 1990s has shown that the resolution of crises involved co-operative efforts in which all parties concerned actively participated. With the globalisation of economies, the sophistication of financial techniques, the generalisation of marketable debt instruments and the large diversification of various classes of creditors, an appropriate reshuffling of the overall debt crisis framework appears increasingly necessary. In addition to the strengthening of the International Monetary Fund (IMF) crisis management procedures (e.g. enhancing limits to IMF financing), the international debate has first focused on two approaches for facilitating debt restructuring: the so-called “contractual approach” – based on the generalised inclusion of Collective Action Clauses (CAC) in bond contracts – and the “statutory approach”, i.e. the proposal of a legal international sovereign debt restructuring mechanism (SDRM). While important progress has been achieved in promoting CACs, including their incorporation in recent bond issues of major emerging market countries, the 2003 IMF Spring Meetings concluded that it was not feasible at this stage to move forward to establish the SDRM, while recognising that work should continue on issues that are of general relevance to the orderly resolution of crises. Against this background, the international community and the private sector have expressed interest in developing a non-statutory framework for addressing debt-servicing problems, based on a proposal of a voluntary “Code of Good Conduct” put forward by Governor Trichet. This Code would lay down general principles to be complied with by all stakeholders, provide creditors and debtors with a « roadmap » of the debt renegotiation process and a “tool kit” consisting of a range of instruments (primarily CAC), and procedures regarded by the international community as best practices. The G7 officials are expected to prepare a report on the Code, in consultation with issuers and the private sector by autumn 2003.

Hot-carrier-induced deep-level defects from gated-diode measurements on MOSFETs

The reverse-bias current in the gated-diode configuration of hot-carrier degraded MOS devices was measured. It is shown that interface defects created by the degradation contribute predominantly to the generation current. The spatial distribution of the deep-level defects was obtained by means of device simulation

A Class of Free Boundary Problems with Onset of a new Phase

A class of diffusion driven Free Boundary Problems is considered which is characterized by the initial onset of a phase and by an explicit kinematic condition for the evolution of the free boundary. By a domain fixing change of variables it naturally leads to coupled systems comprised of a singular parabolic initial boundary value problem and a Hamilton-Jacobi equation. Even though the one dimensional case has been thoroughly investigated, results as basic as well-posedness and regularity have so far not been obtained for its higher dimensional counterpart. In this paper a recently developed regularity theory for abstract singular parabolic Cauchy problems is utilized to obtain the first well-posedness results for the Free Boundary Problems under consideration. The derivation of elliptic regularity results for the underlying static singular problems will play an important role

Inventory of forest and rangeland resources, including forest stress

The author has identified the following significant results. Road systems being developed within the Manitou, Colorado area for human habitation are readily discernible on the S192 normal-color photographs. These are dirt roads, some of which are about 20 feet wide. These data should provide the District Ranger of the Pike National Forest required information on the size and extent of these developing areas, information which he does not now have but is required for total management of the District

Inventory of forest and rangeland resources, including forest stress

There are no author-identified significant results in this report