A debt moratorium is a delay in the payment of

debt Debt is an obligation that requires one party, the debtor, to pay money Loan, borrowed or otherwise withheld from another party, the creditor. Debt may be owed by a sovereign state or country, local government, company, or an individual. Co ...

s or

obligation An obligation is a course of action which someone is required to take, be it a legal obligation or a moral obligation. Obligations are constraints; they limit freedom. People who are under obligations may choose to freely act under obligations. ...

s. The term is generally used to refer to acts by national governments. Moratory laws are usually passed at times of special

political Politics () is the set of activities that are associated with decision-making, making decisions in social group, groups, or other forms of power (social and political), power relations among individuals, such as the distribution of Social sta ...

commercial Commercial may refer to: * (adjective for) commerce, a system of voluntary exchange of products and services ** (adjective for) trade, the trading of something of economic value such as goods, services, information or money * a dose of advertising ...

stress: for instance, on several occasions during the

Franco-Prussian War The Franco-Prussian War or Franco-German War, often referred to in France as the War of 1870, was a conflict between the Second French Empire and the North German Confederation led by the Kingdom of Prussia. Lasting from 19 July 1870 to 28 Janua ...

, the French government passed moratory laws. Their international validity was discussed at length, and was upheld in the

English law English law is the common law list of national legal systems, legal system of England and Wales, comprising mainly English criminal law, criminal law and Civil law (common law), civil law, each branch having its own Courts of England and Wales, ...

case ''Rouquette ''v'' Overman'' (1875) LR 10 QB. Debt moratoriums are generally opposed by creditors. Proponents of debt moratoriums argue that it is a sovereign decision by the government of a nation to suspend repayment of debt to its creditors, if to do otherwise would do irreparable harm to the welfare of its citizenry. A debt moratorium may take the form of a complete cessation of debt repayments, or a partial cessation: for example, the government of President Alan García of

Peru Peru, officially the Republic of Peru, is a country in western South America. It is bordered in the north by Ecuador and Colombia, in the east by Brazil, in the southeast by Bolivia, in the south by Chile, and in the south and west by the Pac ...

implemented the so-called "Ten Per Cent Solution", when it was announced that only 10% of export earnings would go to debt payment. Nations which have, at one time or another, declared a debt moratorium include Peru,

Pakistan Pakistan, officially the Islamic Republic of Pakistan, is a country in South Asia. It is the List of countries and dependencies by population, fifth-most populous country, with a population of over 241.5 million, having the Islam by country# ...

Brazil Brazil, officially the Federative Republic of Brazil, is the largest country in South America. It is the world's List of countries and dependencies by area, fifth-largest country by area and the List of countries and dependencies by population ...

Ukraine Ukraine is a country in Eastern Europe. It is the List of European countries by area, second-largest country in Europe after Russia, which Russia–Ukraine border, borders it to the east and northeast. Ukraine also borders Belarus to the nor ...

Mexico Mexico, officially the United Mexican States, is a country in North America. It is the northernmost country in Latin America, and borders the United States to the north, and Guatemala and Belize to the southeast; while having maritime boundar ...

Russia Russia, or the Russian Federation, is a country spanning Eastern Europe and North Asia. It is the list of countries and dependencies by area, largest country in the world, and extends across Time in Russia, eleven time zones, sharing Borders ...

, and

Argentina Argentina, officially the Argentine Republic, is a country in the southern half of South America. It covers an area of , making it the List of South American countries by area, second-largest country in South America after Brazil, the fourt ...

. In 2008, President Correa of

Ecuador Ecuador, officially the Republic of Ecuador, is a country in northwestern South America, bordered by Colombia on the north, Peru on the east and south, and the Pacific Ocean on the west. It also includes the Galápagos Province which contain ...

declared a moratorium on foreign debt repayments, describing the obligations as "immoral" and "illegitimate". Ultimately, the moratorium targeted two bonds in particular, and other obligations were paid. Several European countries introduced various debt moratoria in connection with the consequences of the

COVID-19 pandemic The COVID-19 pandemic (also known as the coronavirus pandemic and COVID pandemic), caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), began with an disease outbreak, outbreak of COVID-19 in Wuhan, China, in December ...

. On 4 April 2021, Supreme Court of India also asked the PSU banks in India for Interes
waiver on loans
for th
moratorium of loans
taken by citizens of India during pandemic lockdown.

References

{{reflist Moratorium

See also

References