New Focus Paper: Vulnerability as a basis for debt relief

In the current handling of sovereign debt crises, creditors separate countries into needy and non–needy according to their income levels. This has led to questionable results in the past. On the initiative of countries that were excluded from debt relief despite a high risk of over–indebtedness, the United Nations has now introduced the so–called “Multidimensional Vulnerability Index” (MVI). This focus paper by Jürgen Kaiser explores whether this index could serve as a decision–making basis for granting debt relief and what further reforms would be necessary.