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Debt Restructuring and
Rescheduling
1

National Workshop on Capacity-Building For
External Debt Management in The Era of
Rapid Globalization

August 30 \u2013 31, 2005

Francis Odubekun
Government Debt Issuance & Management Advisor
US Treasury Department \u2013 Office of Technical Assistance

Debt Rescheduling
2
\ue000Debt Rescheduling - a form of debt re-organization in

which debtors and creditors negotiate to defer payments
of principal and/or interest falling, due in a specified
interval for repayment on a new schedule.

\ue000The term \u201cRestructuring\u201d is used to include the
rescheduling of interest and principal payments as well as
a write-down on the debt principal or interest rate.
\ue000Conventionally, Debt Restructuring is the process of
rescheduling medium- to long-term debt maturities or
refinancing short-term debts and/or interests.
Historical Perspective
3
\ue000Debt has been the largest source of capital flows to
developing countries in the past 50 years.
\ue000Lending increased drastically starting in the 1970s,

and today the total external indebtedness of
developing countries is close to $3 trillion \u2013
representing about 42.5% of their GDP.

\ue000Long-term foreign debt owed or guaranteed by
governments is $2.2 trillion or 75% of all long-term
debt.
\ue000Given their weak economies, developing countries
have found it difficult to service such debts.
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