In order to assist countries in their efforts to reduce financial vulnerability, the Interim Committee (the predecessor of the International Monetary and Financial Committee (IMFC), requested that the Fund and the World Bank staffs, in cooperation with national debt managers, develop a set of guidelines on public debt management. The Guidelines are designed to assist policy makers in considering reforms to strengthen the quality of their public debt management and reduce their country's vulnerability to international financial shocks. The need for such Guidelines was also highlighted by the Financial Stability Forum as part of efforts to strengthen risk management and governance in the public sector and help reduce external vulnerabilities.

The Guidelines cover both domestic and external public debt and encompass a broad range of financial claims on the government. They seek to identify areas in which there is broad agreement on what generally constitutes sound practices in public debt management. The Guidelines focus on principles applicable to a wide range of countries at different stages of development and with various institutional structures of national debt management. They should not be viewed as a set of binding practices or a rigid prescription, nor suggest that a unique set of sound practices exists, which would apply in all countries in all situations.

In order to gather feedback from a large group of officials from member countries, including those responsible for macroprudential policies, the staffs of the IMF and the World Bank held five regional outreach meetings in Chile, China (Hong Kong SAR), South Africa, United Arab Emirates, and the United Kingdom. The IMF and World Bank staffs also presented the Guidelines at a seminar for Western Hemisphere countries organized by the Canadian authorities. More than 300 representatives from 122 countries and territories and 19 institutions participated in these meetings.

The feedback provided was taken into account in the final version that was endorsed by the Executive Directors of the World Bank and the Executive Board of the International Monetary Fund in March 2001.

Download the Guidelines:

• in English (116K PDF)
• in French (125K PDF)
• in Spanish (225K PDF)
• in Russian (524K PDF)
• in Arabic (325K PDF)

Guidelines Amendments

The IMF and World Bank staffs have developed two new guidelines to include in the IMF/World Bank Guidelines for Public Debt Management. There have been a couple of developments in the public debt management field since the Guidelines were published in March 2001. In particular, the last two years have witnessed extensive discussions on the ways in which one can assess the sustainability of member countries’ public debts, and on some of the legal features that should be included in bond instruments. Although the Guidelines cover a broad range of debt management activities, issues of public debt sustainability and legal features were not discussed. Now that a broad consensus is beginning to emerge on the appropriate framework to guide debt sustainability discussions and on some of the legal features of debt instruments, the IMF and World Bank staffs have developed two new guidelines that would address these issues so that the Guidelines remain current and reflect sound practice in the public debt management field. The preparation process included consultation with the Boards of both organizations and public debt managers, and resulting comments were incorporated in the final text.

Download the Background Document on the Amendments:

Accompanying Document to the Guidelines

In the course of the Board discussions in March 2001, Executive Directors of both institutions asked the staffs to prepare an accompanying document to the Guidelines "that would contain sample case studies of countries that have developed strong systems of public debt management." At the same time, the Executive Directors requested that this report should not expand or add to the Guidelines, but rather that the Accompanying Document would delineate the experiences of various countries in the form of case studies.

The report illustrates the variety of approaches taken by 18 countries from different parts of the world, and at different stages of economic and financial development, to strengthen their public debt management practices in a manner consistent with the Guidelines. The experience of these countries should offer some useful practical suggestions of the kinds of steps that other countries could take as they strive to build their capacity in public debt management.

In line with the process adopted for the Guidelines, the preparation of the Accompanying Document has been one that has sought ensure that the description of individual country practice and the lessons learned are well-grounded. To this end, the case studies were prepared by government debt managers with the coordination of staff from the World Bank and the IMF. World Bank and IMF staffs also prepared Part I of the report, which summarizes the key lessons from the case studies. Two formal rounds of consultations were held with the country officials that prepared the case studies, and an outreach conference organized by the World Bank and the IMF was held in Washington in September 2002. In this occasion, the officials from contributing countries met to discuss the lessons drawn from the case studies and the report as a whole.

The 18 case studies were prepared by the following countries:

• Executive Summary and Part I (120KB PDF)
• Entire document (984KB PDF)
  

Handbook on Developing Government Bond Markets

Sound debt management goes hand in hand with the need to develop the domestic government bond market. A balanced development of the domestic government bond market with a diversified domestic investor base allows the government to tap a secure source of financing and can help to reduce the vulnerability of the government debt portfolio to financial shocks.

The handbook presents an overview of the major policy considerations for establishing a government securities market. It covers such topics as the linkages with money markets and monetary policy operations, policies needed to develop an issuing strategy, debt-management considerations to build credibility, and the reforms necessary to promote institutional investment. It includes bibliographic and website references along with a comprehensive glossary of terms related to securities markets.

Managing Public Debt: From Diagnostics to Reform Implementation

While the Guidelines for Public Debt Management (March 2001) and the Handbook on Developing Government Bond Markets (July 2001) offer generalized guidance and are necessarily idealized, they present a set of principles on which there is broad international agreement. Still, the process of moving from a set of general principles to a program of concrete reforms and capacity building in a particular country is anything but straightforward. Recognizing this, a joint World Bank-IMF Pilot Program including 12 countries was initiated in 2002.

The 12 countries in the pilot program--Bulgaria, Colombia, Costa Rica ,Croatia, Indonesia, Kenya, Lebanon, Nicaragua, Pakistan, Sri Lanka, Tunisia, and Zambia—represent geographic diversity and countries at different stages of economic and financial development. Managing Public Debt: From Diagnostics to Reform Implementation, together with its companion volume, Developing Domestic Government Debt Market: From Diagnostics to Reform Implementation, draws on insights from the pilot program. The experiences of the 12 countries illustrate the challenges and elements necessary to make progress in the areas of public debt management, which will be useful for governments that are contemplating or in the process of reforming their practices, providers of technical assistance, as well as practitioners working on building capacity in public debt management.