Comment on "Toward a Statutory Approach to Sovereign Debt Restructuring: Lessons from Corporate Bankruptcy Practice around the World"

The first three-fifths of Patrick Bolton’s paper surveys corporate bankruptcy practices in various major countries. Then the remaining two-fifths attempts to draw lessons for the SDRM initiative currently being pursued at the IMF and for competing proposals of other ways to ease debt restructuring in emergingmarket crises. This well-written paper is a welcome contribution in two ways. In the first place, it is a very clear and concise exposition of bankruptcy practices. Most writings on the subject are impenetrable to nonspecialists, because they toss around terms like debtor-in-possession and cram-down without defining them, although there do exist a few other good papers that explain the basics. But they tend to focus exclusively on U.S. practice or, at most, U.S. and U.K. practice. So this comparative study is particularly useful, and would be even if it stopped at that. But there is a higher purpose.