Q. Risk Management also Hedging Strategy Using Swaps: Debt for Equity Swaps:

A few years back the Government of Japan made the offer to the Government of Brazil:

The Brazilian government will provide the "Exclusive rights to all the Minerals/ Metals/ also Mining opportunities in Brazil to a consortium of Japanese Corporations for one hundred years to mine, manufacture, extract also sell the commodities. After the one hundred years the Japanese corporations will vacate also the properties will be transferred to the Brazilian government or its designee. In return for this privilege the Japanese Consortium will retire the "entire external debt" of the Brazilian Government (This was estimated to be $250 billion dollars).

Classify from the perspectives of the Japanese also Brazilian Governments illustrate what are the advantages also disadvantages of this proposal. Could this Debt for Equity Swap Work?

Explain why or Explain why Not? Illustrate what are the potential problems?

As a global manager, illustrate what strategies should you adopt to make this work?