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Understanding Foreign Debts and Types

This document discusses different types of government debt, including internal debt owed to domestic lenders and external debt owed to foreign lenders. It also discusses causes of overspending that can contribute to debt like subsidies, grants, and expensive construction projects. The document notes that developing countries may feel pressure to overexploit natural resources to generate cash needed to pay debts. It provides examples of how debt has negatively impacted environmental conservation projects in Brazil and the Philippines. Potential solutions mentioned include reducing trade barriers, IMF reforms, debt restructuring, and debt forgiveness.

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5 views11 pages

Understanding Foreign Debts and Types

This document discusses different types of government debt, including internal debt owed to domestic lenders and external debt owed to foreign lenders. It also discusses causes of overspending that can contribute to debt like subsidies, grants, and expensive construction projects. The document notes that developing countries may feel pressure to overexploit natural resources to generate cash needed to pay debts. It provides examples of how debt has negatively impacted environmental conservation projects in Brazil and the Philippines. Potential solutions mentioned include reducing trade barriers, IMF reforms, debt restructuring, and debt forgiveness.

Uploaded by

api-3706215
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd

FOREIGN DEBTS

What is Debt?
Something owed to another
 State of owing something
 Usually refers to assets owed
 In the case of assets, it is a
means of using future
purchasing power in the
present before a summation is
earned.
THE KEY PLAYERS
INVOLVED IN A DEBT

Debtor
- the person or organization who owes
money to someone or a certain organization
for providing goods and services to them
Creditor
- someone who lends the money to the
debtor
Types of Government
Debts
Internal
-owed to lenders within the
country
External
-owed to foreign lenders
Short Term
-one year or less
Long Term
-more than ten years
overspendin
g
Overspending in what????
-hiring private businesses in doing
government projects
-too much money paid in social security
-Subsidies
-grants
-disaster relief
-political campaigns
-government bonds sold in high interests
-transportation of weapons and products
-expensive construction products
Jubilee 2000
- “the more the
developing countries stay in
debt, the more they feel that
they need to milk the earth’s
resources just to get the hard
cash they can bring in.”
• Brazil's IMF debt and financial
problems have severely affected a
project to save the Amazon
rainforest.
• In the Philippines, several
international agencies worked
together with the Philippine
government to arrange a "debt-for-
nature swap," in which old unpaid
loans to the Philippine government
- Haribon initiated a small
program in 1990 in the communities
surrounding Mount Isarog to help
 Reduction of trade barriers

 International Monetary
Funds(IMF) Assistance Reforms

 Debt Restructuring

 Debt Forgiveness

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