Odious Debt

Public international law does not encompass external sovereign debt. In particular, the current status of ‘odious debt’, which may also be termed ‘illegitimate debt’, in international law epitomizes the weakness of international law with respect to external sovereign debt. Odious debt is subject to politics and ad hoc relations on the international stage. By and large, the law engages with external sovereign debt on the national level—e.g., via the national laws and the national courts of financial centers. In the event of a dispute regarding external sovereign debt, it is very rare that international law or international adjudication deal with external sovereign debt.