The World Bank is urging “radical” debt transparency for developing countries and their lenders to stave off future crises, it said in a report released on Friday.
The Bank wants to broaden the depth and detail of what sovereign countries disclose regarding new loans, as more of them enter complex, off-budget borrowing deals due to global market turmoil.
“When hidden debt surfaces, financing dries up and terms worsen,” World Bank senior managing director Axel van Trotsenburg said in a statement, adding: “Radical debt transparency, which makes timely and reliable information accessible, is fundamental to break the cycle.”
The Bank wants countries to make legal and regulatory reforms that mandate transparency when signing new loan contracts and to share more granular debt data.
It also wants more regular audits, the public release of debt restructuring terms, and for creditors to open their loan and guarantee books.
It is calling for better
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