Debt Deals That Burned Emerging-Market Borrowers Make a Comeback
- Suriname clinches debt-restructuring deal using oil warrants
- Recovery tools may pave the way for other troubled nations
This article is for subscribers only.
Mitu Gulati, a University of Virginia law professor, has studied a lot of sovereign debt defaults and restructurings over the years. One clear conclusion he’s come to: Countries get “screwed” when they toss in complex financial instruments as a sweetener to convince creditors to accept the deals they’re proposing.
So when Suriname unveiled an agreement this month that includes a high-fangled security pledging to hand creditors a cut of a potential oil bonanza, it got Gulati’s attention.