And, if a debt crisis is near, exceptions will be found, waivers will be issued, and buyers for the additional debt will be lined up.

Low interest rates mean that the additional debt burdens that public borrowing will create can remain manageable.

Another subject we should like to highlight regarding debt relief is that once these announcements of additional reductions are made, rumours arise of reductions in additional cooperation resources.

Debt relief provided to countries with debt arrears merely amounts to an accounting exercise.16 ODA in the form of non cash assistance and debt relief17 does not bring additional budget support or foreign exchange transfer.

That translates into an additional 16billion per year in interest payments on Greece s current debt of 273 billion.

And the projected fiscal deficits imply that the additional debt that will be issued during the next decade will be as large as the total stock of debt today.

They must also ensure that additional official financing and debt relief will not distort incentives or create moral hazard.

In short, Latin American countries have used their additional export revenues to pay down debt and increase social spending.

In these circumstances, the additional costs of debt service easily outweigh any gains that might come from some measure of fiscal relaxation.

This is why debt relief is so important. It provides governments additional resources to invest in initiatives that can empower their people.

Additional progress has been made in reducing the unsustainable debt burdens impeding the ability of developing countries to meet the Millennium Goals.

However, it was stressed that further efforts were needed and that debt relief should not come at the expense of additional aid.

Moreover, if the stimulus succeeds and leads to an early recovery, the additional income gained may more than offset the increase in debt.

In addition, if donor flows have to be sterilized in order to meet monetary policy targets, this may create additional debt servicing costs.

However, it was stressed that debt relief should be widespread, without negative conditionalities and should not come at the expense of additional aid.

I would like to speak about additional resources beyond the contribution of debt cancellation pledged by the Group of Eight, which we welcome.

The ECB would not be facilitating additional borrowing by member countries it would merely allow them to refinance their debt at a lower cost.

Excessive emphasis on fiscal rigor, unaccompanied by measures to stimulate growth, has reinforced recessionary trends, placing additional strain on national budgets and debt GDP ratios.

We welcome the declaration by the Group of Eight favouring debt cancellation, time bound commitments for enhanced ODA and the efforts for additional innovative financing.

But the declining value of their sovereign debt and the size of that debt relative to that of Europe s smaller distressed countries implies much greater erosion of banks capital base, raising the additional risk of liquidity problems and further economic damage.

Aging populations in most advanced economies imply additional public debt in the long term, owing to non fully funded pension schemes and rising health care costs.

We welcome the declaration of the Group of Eight favouring debt cancellation, time bound commitments for enhanced official development assistance, and efforts for additional innovative financing.

A lower price level would also increase the real value of business debt, weakening balance sheets and thus making it harder for companies to get additional credit.

In this respect, the G 8 has recently agreed to provide additional resources in order to cover the cost of full cancellation of the HIPC multilateral debt.

Additional debt cancellation should be achieved without reducing the resources available to other developing countries, and without jeopardizing the long term financial viability of international financial institutions.

Debt relief initiatives should be additional to ODA resources for development purposes and should be all encompassing, so that all heavily indebted developing countries can benefit appropriately.

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

If the latter, the best course of action would be to save the additional income or use it, as a second best option, to reduce the national debt.

There was a broad consensus that additional efforts were needed to further reduce the unsustainable debt burdens of many developing counties, in particular of the least developed countries.

Without sound economic fundamentals and efforts to seek additional earnings, developing countries could easily relapse into the vicious circle of poverty, debt, and borrowing once aid dries up.

Any approach to the issue must continue to explore the problem of our countries' external debt, linking the important concept of debt sustainability not only to the attainment of the Millennium Development Goals (MDGs), but also to the MDGs plus , or additional millennium development goals.

Although he shored up his businesses with additional loans and postponed interest payments, by 1991 increasing debt brought Trump to business bankruptcy and to the brink of personal bankruptcy.

Debt sustainability and debt relief

China faces additional debt risks from contingent liabilities and inter departmental risk conversion, especially in the form of implicit guarantees on debts incurred by local governments and state owned enterprises.

More debt relief encompassing more countries and more debt (including bilateral debt) is needed.

But, even though the additional loans that Greece will soon receive from the European Union and the IMF carry low interest rates, the level of Greek debt will rise rapidly to unsustainable levels.

Commitments regarding increased debt relief, further normalization of relations, and additional aid and investment are possible incentives that European states could put on the table, particularly in the hard push before January 9.

Indeed, we should do it repeatedly, until there are signs that additional stimulus may start to threaten price or debt management stability, or until unemployment falls far enough to make Barro s multipliers overestimates.

In addition to reducing debt, Chile used its additional revenues to increase the resources of two fiscal funds when the recession began, there were more than 22 billion in assets in both funds.

Such new funding needs to be non debt creating, additional to existing development aid flows and channelled directly to recipient countries and, where appropriate, should utilize public private partnerships seeded by donor funding.

Unsustainable private debt problems must be resolved by defaults, debt reductions, and conversion of debt into equity.

On one side is concern about another downturn and deflation. On the other side is the risk of excessive debt, currency instability, and where unemployment is structural doubts about the benefits of additional stimulus.

The search for additional and more stable funding to meet the MDG s has led to various proposals for innovative financing mechanisms and debt relief, in particular by British Chancellor of the Exchequer Gordon Brown.

But, in the end, there are only three ways to secure additional financing for development aid or debt relief higher taxes, increased indebtedness (that is, higher taxes for future generations), and or monetary expansion.

When non standard measures are required because of loss of confidence in sovereign debt, such messages must seek to avoid the measures failure by highlighting the risk of major additional difficulties in the future.