Debt Sustainability and Net Outward Financial Transfers-Deterrent to Growth in a Debtor Economy

Financial Transfers Deterrent to Growth in a Debtor Economy Byasdeb Dasgupta This note offers an analytical basis for the transfer problem which besieged the debtor developing world following the outbreak of the debt crisis in the early 1980s. Section I of the note explains the importance of the concept of the transfer in the context of the debt problem of the indebted nations of the south. Section II spells out the debt dynamics through which net transfers of financial resources from an indebted country take place. Section III analyses the role of exchange rate devaluation in effecting net transfers of financial resources from debtor developing countries.