Can the Baker Plan solve the world debt crisis?

Can the Baker Plan solve the world debt crisis?

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Can the Baker Plan solve the world debt crisis?


Title:	Can the Baker Plan solve the world debt crisis?
Author:	Bruce R. Bartlett (Interviewee); John W. Sewell (Interviewee); Krogh, Peter F. (Peter Frederic) (Moderator)
Abstract:	Examines the roots of the world debt crisis and Treasury Secretary James Baker's plan for debt relief.
Description:	In 1982 the Mexican government announced that it had run out of foreign exchange reserves and was unable to repay its debts. This announcement signaled the beginning of an international debt crisis that rocked the world's financial system and threatened the solvency of major Western banks. The crisis began brewing in the 1970s and early 1980s, when the borrowing of developing countries rose precipitously. By 1987 western banks had loaned more than $830 billion to the third world, and many developing countries found it increasingly difficult to meet their payments. As the chances that the banks would be repaid appeared to grow dimmer by the day, many feared for the solvency of the commercial banks. In response to the situation U.S. Treasury Secretary James Baker outlined a proposal that aimed to avert a third world debt crisis through economic reforms and additional loans from western banks. The goal of the Baker Plan, as it became known, was to provide economic growth for the third world and solvency for the western banking establishment. Critics argued, however, that the plan would do nothing but extend the inevitable bankruptcy of the developing world. In this episode John Sewell, President of the Overseas Development Council, and Bruce Bartlett of the Heritage Foundation sit down with host Peter Krogh to discuss the world debt crises and the Baker Plan's prospects for success.
Permanent Link:	http://hdl.handle.net/10822/552514
Date Issued:	1987
Date Created:	1987
Subject:	Loans, Foreign -- Developing countries ; Debts, External -- Developing countries ; Baker Plan ; World Debt Crisis ; International Banking