A feasibility check on core elements needed for "orderly" sovereign debt restructuring and/or debt mutualisation in the Euro Area

Eingehende Analyse 24-05-2019

The purpose of this briefing note is to explore the requirements for orderly sovereign debt restructuring or the mutualisation of sovereign debt among the Euro Area Member States. The briefing has three sections. The first provides an overview of the challenges associated with restructuring sovereign debt in the euro area. The second examines the underlying need for sovereign debt restructuring and assesses how much of that need can be addressed or mitigated through the institutions for European macroeconomic governance. The third section offers policy recommendations to meet those challenges that remain.