He has refused to incur further foreign debts except on the most concessionary terms.
It has been late in paying several foreign debts, including one to Britain's Export Credit Guarantee Department.
European countries have to pay more interest on their foreign debts than Brazil does for similar long dated maturities.
The greatest source of downward pressure on South-East Asia's currencies comes from local firms desperate to service their foreign debts.
That kind of safety can be seen in the low yields on its foreign debts, priced in dollars, currently around 3%.
Bad could turn to worse if Pakistan defaults on its foreign debts.
It was caught in a vicious circle: as the won sagged, it needed to boost exports to generate enough hard-currency cash to service its foreign debts.
Government spokesmen say that the money will not be spent in Venezuela but instead will be used to pay foreign debts or to purchase capital goods abroad.
Its net foreign-exchange exposure is nil, but Iceland was in a similar position, and its banks have not been able to liquidate foreign assets to cover their foreign debts.
Sanjeev Prasad at Kotak, a broker, says that the recent results season saw a host of firms booking losses as the value in rupees of their foreign debts rose.
Unemployment is heading for 18%, most bank deposits have been frozen since March, and the beleaguered government of President Jamil Mahuad has defaulted on some of its foreign debts.
Furthermore, the Latin American economies have huge foreign debts, amounting to around 300% of exports in Brazil and Argentina, compared with an average of less than 100% in Eastern Europe.
The foreign debts represent only 6% of total bank assets and the effect on these liabilities is mitigated by the dollar assets banks create with this funding through export-credit financing.
Morgan in Singapore, points out that, although the region's foreign debts are largely denominated in dollars, this is less an issue for Asia than it would be for other emerging economies.
If we are interested in distribution from the point of view of issues such as migration, the marginalisation of developing countries and capacity to repay foreign debts, we should compare incomes with market exchange rates.
Borrowers with foreign-currency debts find them much more expensive to repay.
That would make servicing foreign-currency debts less crippling and might even allow domestic interest rates, which have been kept high to stabilise exchange rates, to drop a bit.
What about the private equity funds that have been buying distressed debts or foreign banks or funds?
Hungary's new central-bank governor is looking for ways to jump-start the country's recession-hit economy, with one possibility being to use the bank's reserves to bail out households with debts in foreign currencies.
Thanks largely to energy revenue, Russia this summer paid off debts to foreign creditors well ahead of schedule, economists expect gross domestic product growth of 6.5% for 2006, and the market is up 35% this year.
Even if inflation remained moderate, many firms as well as the government would default on loans, since 90% of government debts and 80% of private-sector debts are in foreign currency.
The country's debts are growing, foreign investors have been scared away and unemployment is increasing again.
Other countries which have defaulted on their debts have found that foreign investors soon return.
Andy Xie, chief China economist for Morgan Stanley Dean Witter in Hong Kong, points out that if foreign creditors don't roll over debts for red-chip companies, most of which are severely overstretched financially, the latter could start going under too.
The agreement's most serious result will be to give Russia a basis for haggling with its other creditors (foreign banks and western governments) over the debts it took over from the Soviet Union in 1991.
Although many big emerging markets have built up foreign-exchange reserves and cut their external debts, in eastern Europe reserves have been flat, external debts have risen and current- account deficits have grown considerably in the past decade.
Though India's banks face bad debts, its cloistered financial system, high foreign-exchange reserves and capable central bank mean it is not about to keel over.
To earn the foreign exchange needed to pay for imports and to service debts, reliance on a single commodity (like Zambia's copper) is just too risky.
In neighbouring Saudi Arabia, reports suggest an indebted family conglomerate is trying to resolve its debts by favouring local banks at the expense of foreign ones.
The United States also aims to increase foreign assistance to ease poverty, boost education, cancel the debts of poor countries, and launch a "green revolution" that produces sustainable supplies of food.
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