Introduction to the special issue on sovereign debt restructuring

After the ‘wasted decade’ of the Latin American debt crisis of the 1980s, and the long-running saga following Argentine default in 2001, sovereign debt crises were widely regarded as a feature of ‘emerging market’ economies, but not for ‘advanced economies’, which had been enjoying a period of macroeconomic stability since the mid-1980s. That illusion was shattered when the period known as the Great Moderation ended abruptly in the financial crisis of 2008/9 and problems of sovereign debt management spread across Europe. Adverse speculation in the Eurozone pushed interest rates on the sovereign debt of Italy and Spain to unsustainable levels in 2012,1 for example; with contagion leading to substantial Greek default soon thereafter