Although emerging market economies have become more resilient to individual shocks, multilateral financing institutions continue to work to improve the framework for crises management and resolution. This activity helps prevent debtor countries and market participants from placing excessive reliance on the financial support provided by multilateral institutions.

For countries benefiting from multilateral financial assistance, the definition of sound exit strategies from multilateral debt is essential to avoid the prolonged use of multilateral resources. This includes better program design, macroeconomic and structural conditions to achieve debt sustainability, more effective conditionality and a careful consideration of the timing to regain market access.

The global financial crisis of the late 2000s exposed the vulnerabilities of even relatively more advanced economies. Fiscal and monetary authorities have set out to strengthen financial governance in order to create more stable and resilient financial systems, but they continue to face the challenges presented by evolving economic and market conditions.

As a consequence, many countries may experience significant shifts in their debt portfolios, in terms of size, composition and investors’ appetite.