Lima, Peru, October 10, 2015 - The Trustees discussed the comprehensive 2015 Report on the Implementation of the Principles provided to them by the Principles Consultative Group (PCG), which includes senior officials from emerging and mature market economies as well as senior bankers and investors. The Trustees noted with satisfaction that the voluntary, market-based, flexible guidelines for the behavior of sovereign debtors and private creditors underlying the Principles continue to serve as a very useful framework for both crisis prevention and resolution with a view to promote and maintain stable capital flows, support financial stability and sustain growth. The Principles promote crisis prevention through the pursuit of strong policies, data and policy transparency, and open communication and dialogue with creditors and investors, and effective crisis resolution through inter alia good-faith negotiations for a fair debt restructuring deal with representative groups of creditors. They also underscored the importance of enhanced investor relations and data transparency practices and expressed appreciation for the IIF's annual evaluation of these practices by emerging market sovereign bond issuers.
The Trustees noted the PCG's review of the evolving discussions on the effective framework for sovereign debt restructuring. Trustees encouraged the IIF Secretariat, the PCG and the IIF Committee on Sovereign Risk Management to continue advocating for inclusion in full of the standard aggregated collective action, pari passu, and creditor engagement clauses for the terms and conditions of new sovereign bond documentation as recommended by the International Capital Market Association (ICMA). Attention was given to the implementation of sovereign bond contract reforms launched in October of last year, an effort that strengthens the contractual approach to sovereign debt restructuring led by ICMA with active participation from the IIF. The Trustees also welcomed the early discussions between private and public creditors aiming at strengthening coordination between the two.
Finally, the Trustees thanked Agustin Carstens, Governor of Banco de México, who stepped down as a co-chair of the Group on April 19 after five years of service. Governor Carstens will remain a Trustee and will continue his valuable contributions to the implementation of the Principles.