Chapter 9: Concluding Remark
Sovereign funds to the people! Sovereign debts to the people! The underlying objective of the odious debts concept is this simple chant. Contract sovereign funds for the people! Spend sovereign debt on the people! Sovereign debt that does not benefit a debtor country’s people is odious to that people and should not have to be repaid by them. It is simple and obvious. Yet the current legal framework for sovereign finance does not incorporate this basic idea. In truth, it does not incorporate much at all. It is time for clearer and fairer rules to better structure how this important area of international finance functions in practice. This will facilitate more efficient capital markets, and also correct incentives for irresponsible behavior by sovereign borrowers and lenders. This book sets out a blueprint for elevating the odious debt concept into law. The new approach seeks to shine a light on the traditionally dark world of sovereign finance. It seeks to put in place systems and processes that are geared toward a clear understanding of sovereigns and how they finance themselves. It is premised on the principles of transparency, accountability, and citizen participation in public contracts. Unlike earlier scholarship, it focuses less on the nature of the borrowing government, and looks instead to the financier as the primary party to help avert odious debts. It puts in place a public registration system for sovereign contracts. Financiers are encouraged to register and gain greater confidence in contract enforceability. Underlying this proposal is the...
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