Proceedings of the 9th International Conference on Applied Research in Management, Economics and Accounting
Year: 2024
DOI:
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Sovereign Risk Management in Emerging Economies-What are the most effective tools for emerging economies to manage their external debt and reduce sovereign risk?
Gia Bach Nguyen
ABSTRACT:
Emerging economies are significant to the worldwide budgetary framework, stamped by quick development and expanding money related associations. Be that as it may, this development frequently brings noteworthy risks, particularly concerning external debt and the potential for imperial default. This paper investigates strategies that rising economies can utilize to oversee outside obligation and decrease paramount hazard. It looks at debt composition methods like extending maturities and diversifying currencies, as well as fiscal policies including fiscal consolidation and revenue diversification. Furthermore, it looks at liability management strategies such as debt buybacks and exchanges. Through the case of Brazil and Vietnam, the paper gives down to earth bits of knowledge into the adequacy of these procedures. Brazil’s decrease of remote cash borrowing and Vietnam’s vigorous debt management practices highlight effective approaches to overseeing debt and diminishing risk. The analysis underscores the requirement for a key mix of debt management devices, sound fiscal policies, and proactive risk operations. The paper concludes with recommendations for developing economies to broaden their debt portfolios, adjust fiscal consolidation, and strengthen revenue streams. This approach can lead to sustainable debt levels and long-term financial stability. Future questions about ought to investigate the part of innovation in debt management and the evolving bolster from development banks
keywords: External Debt Management, Sovereign Risk, Fiscal Policies, Liability Management, Emerging Economies