For instance, where countries find themselves in debt distress, it may be more difficult to come to rescheduling agreements with a large number of private creditors than when you had, in the past, a relatively small number of public creditors (Paris Club) and/or commercial bank lenders (London Club).
Challenges such as these highlight the need for countries to strengthen debt management practices and improve transparency, which is fundamental to sustainable financing. However, addressing these challenges would require countries to make tough fiscal choices to prevent debt burdens from becoming unsustainable. A prudent debt management strategy is thus key to tackling this challenge.