The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

Yugoslavia: The long hard road back

Contrasting with the bullish prices of much emerging market debt, Yugoslavia's has dropped from being traded in the high forties a few weeks ago to a low of 35%, following inconclusive talks held at the end of June between the government of the Federal Republic of Yugoslavia (the FRY consists of Serbia and Montenegro) and the relevant London Club committee. Some analysts think the price could go lower still.

The reason for the sudden decline in Yugoslav debt is the very aggressive terms of repayment that the government has put on the table. The committee, headed by Chase, feels that the recent proposals to reschedule the debt are unacceptable.

When the former Yugoslavia split, the newly independent FRY assumed responsibility for the lion's share of the old debts. As the biggest of the former Yugoslavian republics, the FRY's financial situation was, at the time, deemed good enough to merit it taking this on. So the question has to be asked: why is the country now pleading poverty for its terms of repayment?

Ingrid Iverson, a debt strategist at UBS, believes that the Yugoslavs did not make their proposal expecting it to be accepted, but as an opening gambit to try to force the price of the debt down.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.


Unlimited access to and

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually


Unlimited access to and, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors


Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree