Chair in Sovereign Debt and Finance

This Chair brings together sovereign debt practitioners and renowned academics in economics, law, finance, history, international relations, and political science to rethink sovereign funding from a multidisciplinary perspective. It aims to become the leading center for research, teaching, and debate on the issue in France and Europe.

Hosted by the Paris School of International Affairs (PSIA),The Sciences Po Chair in Sovereign Debt and Finance was launched on November 2019, with an inaugural conference featuring former Greek prime minister Aléxis Tsípras.

Context and mission

Sovereign debt sustainability, the nature of financing needs, the nature of debt, and the need for improved transparency have become key issues both for ensuring sustainable economic growth and reducing inequalities.

In a context where the creditor landscape and the debt structures of emerging market sovereigns are evolving, and public debt levels are at historic highs, preventing and reducing sovereign debt vulnerabilities, coordinating creditors, defining sustainable debt levels and resolving debt crises are all key challenges. To meet them, it is essential to develop a deeper understanding of the situations and choices of the past decades and to reflect thoroughly on the solutions to be invented for the future.

France is home to the Paris Club, the “main international forum for restructuring official bilateral debt claims”. More than four hundred negotiations involving ninety countries have been conducted through this forum. Yet so far, no academic focal point has been set up in France on sovereign debt issues.

Through the conferences it organizes, the courses it delivers, and the research and publications it support, the Chair in Sovereign Debt and Finance aims to become an intellectual leader on sovereign finance in France and Europe.

Governance and team

The Leadership Team provides directions and ensure that the programme of activities is consistent with the Chair’s overall strategic objectives, and supports the Chair in delivering on the programme of activities and achieving the expected impact.

Paola Subacchi is the incoming Chairholder. She is Professor of Political Economy, University of Bologna. Previously she was at Queen Mary University of London where she contributed to set up the Queen Mary Global Policy Institute. From 2004 to 2019 she was director of economic research and senior fellow at Chatham House (The Royal Institute of International Affairs) in London. She is also a non-executive director of public and private companies and a member of the board of the Istituto Affari Internazionali in Rome. 

The Steering Committee ensures progress against the Chair’s strategic objectives, comprehensive discipline coverage and value for all stakeholders, monitors the overall budget, and oversees the Chair’s fundraising activity and funding allocation decisions. The Committee includes representative of all stakeholders – PSIA, the School of Public Affairs, the department of Economics, the sponsors.

The Scientific Committee acts as a sounding board for the Chair, provides contacts, unlocks networks, and helps foster partnerships. The Committee reviews outcomes and impacts of funded initiatives. Members come from different backgrounds (universities, governments, international organisations, private sector) and have a strong record in policy-oriented research and impact.

Research themes

The Chair’s research activities will cover several main themes, including:

• Debt transparency (implicit guarantees, debt holdings)
• Types of debt (uses of debt financing, debt and growth/development)
• Sustainability analysis
• Debt markets (institutions, microstructure, valuation, sovereign risk)
• Contractual and institutional aspects of restructuring episodes
• Optimal debt structuring (maturity, currency, indexation)
• A comprehensive approach to preventing debt-related vulnerabilities: fiscal policies; the role of monetary, reserve, and foreign exchange policies
• The role of the IMF and multilateral institutions (World Bank, WSS, etc.) in sovereign funding and restructuring episodes

The research programme will be refined throughout 2020 according to the priorities established by the academic committee.

Teaching activities

Case studies

As part of the Chair, a new teaching module is being introduced based on case studies drawn from real debt restructuring episodes. The academic committee  determines the sequence of cases studied during the seminars, which may include, for example, Argentina, Ivory Coast, Ecuador, Gambia, Greece, Indonesia, Pakistan, Ukraine, Venezuela, and Zimbabwe.

One seminar is offered per semester from January 2020, with guest instructors including political leaders involved in the cases, and IMF officials, private creditors, lawyers, and economists involved in determining the solutions.

Each seminar is taught over 24 hours organised in several sessions:

• 12hrs “prerequisites” providing a historical context for the case and setting out the theoretical and institutional fundamentals;
• 12hrs “practicals” with the accounts of practitioners who were involved in the case and discussions with all the participants.

These seminars are open to any member of the student body, faculty or professional community interested in the issues of sovereign finance, within the number of places available. The module is credit-bearing and participants will be assessed.

A specific “business case database” is established with the cases developed through the seminars.

A wide range of courses

Sciences Po already offers its students at PSIA, the School of Public Affairs, and the School of Management and Innovation a wide range of courses related to the broader issue of international finance and to sovereign funding more specifically.

The Chair’s objective is to identify and approve the relevant courses and restructure the whole offering to make it even more appropriate in light of contemporary issues and the research output made possible by the Chair. Dr. Guibaud will develop a series of advanced courses on the subject of sovereign debt for the Master in Economics. 

Events

The Chair’s events programme focus on a major annual conference, which promotes the Chair’s work and brings together students, researchers, experts, and political leaders. The topic will be one of the cases studied in the seminars.

Publications and knowledge transfer

• Business case database.
• An edited volume is published based on its research outputs.
• The Chair website and the Chair Twitter account inform the partner, researchers, students, and the general public of the Chair’s activities.

The Strategic Plan 2024-2026

The Strategic Plan 2024-2026 builds on the success, as well as on lessons learned, in the Chair’s first three years. The overall goal for the next three years is to make the Chair an internationally recognised hub for policy-oriented research where new ideas can be put forward and implemented. The Chair will bring together scholars and students from across and outside the institution and contribute to further develop SciencesPo’s international footprint.

The Strategic Plan revolves around the following six strategic objectives:

• Advance impartial policy-oriented research on sovereign debt and the international financial architecture;
• Develop and maintain a policy hub for innovative public policies to generate and share knowledge and best practice;
• Engage in and influence the international policy dialogue by addressing the most challenging and urgent policy problems around sovereign debt and devising practical solutions;
• Offer an independent convening space to scholars, students, policymakers, decisionmakers and the civil society;
• Promote learning opportunities and a diverse range of perspectives, and support student research and engagement in international affairs so to “educate openminded and enlightened citizens capable of changing the world and transforming society;”
• Build a community of partners and supporters to underpin the Chair’s activities.