Economics & Development

Hidden government debt—liabilities that governments incurred but did not fully disclose—can undermine fiscal sustainability. This paper identifies seven hidden-debt revelations during 2005–25 and measures the response of daily sovereign risk spreads following revelations. It finds that sovereign risk spreads rise gradually but persistently in response to a revelation. The pooled sovereign risk spread for the seven countries rises substantially, by 108 basis points on average during the first 30 days after a revelation (with 66 basis points of that in the first 10 days), and an additional 98 basis points during days 31–60. The baseline results are robust to various alternative specifications. Additional exercises show that when debt reconciliation is delayed or contested, sovereign spreads rise roughly 200 basis points more over 60 days than when reconciliation is prompt, although, with only seven episodes, this finding is suggestive.

This chapter highlights the evolution of airport infrastructure and its critical role in advancing air transport, connectivity, and economic development. Airports have transformed from simple airstrips into modern transportation hubs that facilitate global mobility and trade. For remote islands and landlocked regions, airports often provide the only reliable access to people, goods, and services. Strong airport connectivity attracts investment by improving access through direct flights, route frequency, and convenient links to urban centers. Airports also generate significant economic benefits through employment and business activity. According to industry estimates, every million passengers can support approximately 4,700 jobs, reinforcing aviation’s contribution to regional growth.

This chapter explores the regulatory and oversight framework governing civil aviation, emphasizing the importance of international standards, enabling legislation, and effective regulatory institutions in ensuring safe, secure, and efficient air transport operations. It examines the role of civil aviation authorities, state safety and security programs, and the licensing and certification requirements applicable to aviation stakeholders. The chapter also discusses state sovereignty over airspace and the international responsibilities assumed by some countries for managing portions of global airspace. It traces the evolution of international aviation governance from bilateral agreements to the establishment of the International Civil Aviation Organization (ICAO) under the Convention on International Civil Aviation. The chapter highlights ICAO’s role in developing global standards, promoting regulatory harmonization, enhancing competition, supporting consumer needs, and fostering economic growth through a safe, sustainable, and interconnected aviation system.