We construct measures of net private and public capital ows for a large cross-section of developing countries considering both creditor and debtor side of the international debt transactions. Using these measures, we demonstrate that sovereign-to-sovereign transactions account for upstream capital ows and global imbalances. Specically, we nd that i) international net private capital ows (inows minus outows of private capital) are positively correlated with countries’ productivity growth, ii) net sovereign debt ows (government borrowing minus reserves) are negatively correlated with growth only if net public debt is nanced by another sovereign, iii) net public debt nanced by private creditors is positively correlated with growth, iv) public savings are strongly positively correlated with growth, whereas correlation between private savings and growth is at and statistically insignicant. These empirical facts contradict the conventional wisdom and constitute a challenge for the existing theories on upstream capital ows and global imbalances.