2. Pre-Game Show (Terms worth knowing) GDP: Gross Domestic Product HDI: Human Development Index ISI: Import-Substituting Industrialization FDI: Foreign Direct Investment Gini: Corrado Gini (Italy 1912)

3. Sovereign Debt and the Erosion of Sovereignty James Hayes-Bohanan, Ph.D. Professor of Geography & Latin American Studies Bridgewater State University J2000: GETTINGGETTING INTO DEBT

4. What is it for? Credit

5. Big Projects Aswan High Dam: World Bank’s Kick-off Event

6. Petrodollars Literally: Too much of a good thing!

7. Overlending

8. Raúl Prebisch, ECLA Commodity Earnings over Time

9. ¡Basta! Mexico Moratorium August 1982 Brazil followed Slow growth – the lost decade Inflation and hyperinflation Capital flight Contagion effect

10. Baker Plan - 1985 Treasury Secretary James Baker Loans to cover interest payments were made with conditions: Privatization of state enterprises End to subsidies Opening the economies to foreign investment 12 of 15 large debtors complied Soon comprised 20 percent of all World Bank (WB) debt www.ThirdWorldTraveler.com

11. Brady Plan - 1989 Treasury Secretary Nicholas Brady Sought to attract investment by reforming economies Encouraged cooperating private banks to reduce their claims against LDCs Used new IMF (International Monetary Fund)/WB funding to collateralize debts in the form of new bonds - in other words, multilateralized the debt www. darbyoverseas.com

12. Secondary Markets Reduced claims Writing down debt Dimes or pennies on dollars

13. Debt-Equity Swaps

14. Debt-for-Nature Swaps

15. Baker and Brady Plans Liberalization Devalue currency Open markets Reduce government intervention Privatize assets Whirled Bank: A World Full of Poverrty

16. A Consensus?