INTERNATIONAL POLICY ANALYSIS Making the Global Financial System More Resilient A Regional / Group-wise Approach to Sovereign Debt Workouts JÜRGEN KAISER May 2017 n More countries in the Global South are heading towards a new debt crisis due to low global interest rates and low commodity prices. Thus far, there have been no innovative approaches for a possible debt workout with regard to the new crisis. n Regarding the next crisis, there is something to learn from the HIPC/MDRI initiatives of the 1990s and 2000s: overcoming political deadlocks by designing debt relief exclusively for a limited group of countries. n Such a limited debt relief scheme could then imply procedural innovation that could remedy weaknesses of the HIPC/MDRI schemes and debt restructuring mechanisms at large, by making them more comprehensive and impartial.