A. Further debt reduction

Debt reduction, either through stock of debt reduction or debt service reduction based on a concessional rescheduling, will continue to be considered only in exceptional cases.

Debt reduction is not fatal.

(c) The need for debt reduction

External public debt

But that simply shifts leverage to the public sector, with any reduction in the ratio of private debt to GDP more than matched by an increase in the public debt ratio witness the Irish and Spanish governments high and rising debt burdens.

Debt reduction should cover a greater proportion of the debt, in certain cases the total debt.

The debt strategy should include, among other things, a drastic reduction of debt and debt servicing.

c Public sector debt.

This, too, complicates the public debt dynamics and impedes the restoration of public debt sustainability.

A reduction of domestic public debt could also help to boost growth by freeing resources for the productive sectors of the economy.

A debt reduction programme in respect of public schools taken over by local councils, subsidized from the State budget, is in operation.

Servicing of external public debt

a Excludes official public debt.

First, Greek debt reduction was postponed for too long.

(i) Measures for the reduction of official bilateral debt

(ii) Measures for the reduction of official multilateral debt

(iii) Measures for the reduction of commercial bank debt

Such steps include substantial debt reduction and the streamlining of debt relief procedures and requirements.

Instead, they focused exclusively on US foreign debt, ignoring household debt (mortgage and consumer debt), public debt, business debt, and financial debt.

6. The Paris Club had also accepted the principle of debt and debt service reduction for low income countries, although that reduction was still insufficient.

Its public debt was almost eliminated.

Initially, to facilitate debt reduction, bondholders would face another haircut.

Secondly, debt cancellation and reduction should be extended and intensified.

Debt service reduction, normally in the form of interest reduction bonds, has been offered in three ways.

For some, reducing debt burdens to sustainable levels looks increasingly difficult within existing official debt reduction schemes.

More debt relief should be provided, including cancellation of debts, debt reduction and, more generally, innovative schemes.

A similar pattern holds for public debt.

The current favorite bogeyman is public debt.

C. Public debt in the ESCWA region

Public debt in the more diversified economies

In those countries, drastic action was needed for further debt reduction.

52. Operations within the IDA Debt Reduction Facility have increased sharply.

Others felt that even more substantial debt reduction should be granted.

Dividing debtor countries into sub categories would hamper debt reduction initiatives.

Fifth, debt burdens that cannot be eased by growth, savings, or inflation must be rendered sustainable through orderly debt restructuring, debt reduction, and conversion of debt into equity.

21. Stresses that debt relief should contribute to development objectives, including poverty reduction, and in this regard urges countries to direct those resources freed through debt relief, in particular through debt cancellation and reduction, towards these objectives

For countries with unsustainable debt burdens, timely and realistic debt reduction agreements are also essential quot (emphasis added). 17

Reforming countries in debt crisis require an adequate and permanent reduction in the stock of debt . (Ibid., para. 27)

and for a substantial reduction of all types of debt, including multilateral debt, for all categories of developing countries.

Public debt in the Gulf Cooperation Council countries

So, as austerity undermines growth, debt reduction will be marginal at best.

62. Productive investment should be the cornerstone to any debt reduction strategy.

Generally speaking, banks choose from menus that have employed three main categories of options (not all are necessarily available in each case) debt reduction, debt service reduction and new loans.

But the debate about austerity and the cost of high public debt levels misses a key point Public debt owed to foreigners is different from debt owed to residents.