The global financial crisis of 2008-2009 required most sovereign debt managers to adapt to rapidly changing market circumstances, by changing the mix of borrowing instruments and adopting techniques that minimize the impact of severe market dislocations and increased risk aversion. These actions, allied to prudent macroeconomic and debt management policies implemented by government in the years preceding the crises, were critical in helping countries meet their financing needs without undue strain on the financial markets. This toolkit draws on the approaches taken by a range of countries and provides sovereign debt policy makers with a rich set of potential actions to address crisis periods. A practical illustration on the use of some of these actions is conducted by analyzing the measures taken by Romania, Serbia and Turkey as a response to the recent crises. Authors draw lessons from these experiences and examine what other measures included in the toolkit could have been used to boost the crisis response impact in these economies, respecting country-specific contexts.

The global economy has experienced four waves of rapid debt accumulation over the past 50 years. The first three debt waves ended with financial crises in many emerging market and developing economies. During the current wave, which started in 2010, the increase in debt in these economies has already been larger, faster, and broader-based than in the previous three waves. Current low interest rates mitigate some of the risks associated with high debt. However, emerging market and developing economies are also confronted by weak growth prospects, mounting vulnerabilities, and elevated global risks. A menu of policy options is available to reduce the likelihood that the current debt wave will end in crisis and, if crises do take place, will alleviate their impact.

The recent international financial crisis has significantly affected Governments' ability to invest in infrastructure in Europe and Central Asia, with no counterbalancing effects by the private sector. The study identifies the issues dampening private participation in infrastructure in the region and recommends possible practical solutions.

The European Sovereign Debt Crisis: Breaking the Vicious Circle between Sovereigns and Banks explains why the euro area’s progress towards reining in the risks arising from the well-documented bi-directional financial contagion transmission mechanism that links sovereigns to commercial banks has been more prominent compared to the channel of contagion moving from banks to sovereigns. Providing an analysis of the legal and regulatory measures that Europe and the euro area have taken to mitigate the exposure of sovereigns to financial crises generated by commercial banks, this book draws attention to areas where improvements to the arsenal of tools hitherto introduced are either desirable or necessary. Chapters further explain – with recourse to economic and legal arguments – why the channel of contagion moving from sovereigns to commercial banks has proven harder to close, and explores ways in which progress could be made in the direction of closing it so as to avert the risk of future banking sector crises. This work provides essential reading for students, researchers and practitioners with an interest in sovereign debt crises and the euro-area banking system.

"The Sovereign Debt Crisis," 2012 edition, looked at how governments ran up substantial deficits in order to avert a worldwide depression and their subsequent attempts to rebalance their budgets. This updated edition concentrates on the delicate balancing act the economies of the United States, Japan, and the eurozone face between the present need to boost sluggish economic growth by providing sufficiently cheap, low-risk credit and the longer-term challenges of cutting massive debt and returning to a sustainable fiscal policy. The authors argue that many of the euro area economies, having noticeable difficulty paying their international debts, are in a sovereign debt crisis, while America and Japan are, for now, holding steady but in real danger of slipping into crisis. The book shows how the process has evolved in these three major developed economies and how their policy choices impact global financial markets.

The last time global sovereign debt reached the level seen today was at the end of the Second World War, and this shaped a generation of economic policymaking. International institutions were transformed, country policies were often draconian and distortive, and many crises ensued. By the early 1970s, when debt fell back to pre-war levels, the world was radically different. It is likely that changes of a similar magnitude -for better and for worse - will play out over coming decades. Sovereign Debt: A Guide for Economists and Practitioners is an attempt to build some structure around the issues of sovereign debt to help guide economists, practitioners and policymakers through this complicated, but not intractable, subject. Sovereign Debt brings together some of the world's leading researchers and specialists in sovereign debt to cover a range of sub-disciplines within this vast topic. It explores debt management with debt sustainability; debt reduction policies with crisis prevention policies; and the history with the conjuncture. It is a foundation text for all those interested in sovereign debt, with a particular focus real world examples and issues.

The global financial crisis severely affected economies in Eastern Europe and Central Asia (ECA). Currencies depreciated across the region. Government tax revenues declined sharply leading to high budget deficits and rising levels of public debt. Tightening credit supply and deteriorating financial conditions have limited the ability to borrow in the public and private sector. The financial crisis slowed demand enough to delay an imminent energy shortage by a few years. In this sense, the financial crisis bought ECA countries some time. This report analyzes the impacts of the global financial crisis on power sectors in five countries in the ECA region: Armenia, Kyrgyz Republic, Romania, Serbia and Ukraine. It estimates the investment gap and proposes a prioritization of critical investments in each country. The report also proposes actions needed to mobilize financing for the sector, including a continued commitment to legal, regulatory and policy reform in the sector. The global financial crisis has created a window of opportunity to meet investment needs and avert a potential power shortage, but Governments need to recognize and act on this opportunity. This report serves as a starting point to facilitate further World Bank engagement in the region that can help Governments make timely, critical investments and foster sustainable investment in the sector over the long-term.