Abigail McKenna, chairman of the board of the Emerging Markets Creditors Association, which formed part of the group issuing the proposals, said one of the key principles is to have greater transparency in the negotiating process in cases of restructuring. This requires creditors having clearer information on a sovereign’s international reserves. The proposals also push for greater dialogue between the sovereign and investors and creditors to reduce the likelihood of crises.
A further proposal is to enhance the role of trustees to make it easier for creditors to be repaid. The principles, issued today, were set forth in a letter to the G-7 finance ministers and central bank governors.