The Government Debt and Risk Management (GDRM) Program provides customized technical advisory services to middle-income countries in a programmatic approach. The Program assists countries in developing sustainable debt and risk management frameworks to reduce vulnerability to financial shocks.
Customized Advisory Services from diagnostic to implementation
- Governance: Focuses on the legal framework, institutional arrangements, accountability and transparency mechanisms that shape and direct the operations of government debt and risk managers: design of government structures with clear roles and responsibilities, with appropriate checks and balances and clear reporting lines.
- Policy coordination: Focuses on establishing efficient coordination mechanisms between debt management and monetary policy, fiscal and budget planning processes and cash management.
- Strengthening debt and cash management relations: Aims to improve the implementation of the debt management strategy, and supporting domestic market development.
- Capacity and management of internal operations: Includes analysis of organizational structures, development of strategies for recruiting and training staff, and evaluation of information technology systems for debt management transactions, with the aim of reducing operational risks and increasing debt management office efficiency.
Technical Capacity Development
- Debt management strategy development: Covers formulation of debt management strategies based on sound analysis of costs and risks, considering a country’s macroeconomic framework and level of debt market development, determining the composition of public debt portfolio.
- Debt management strategy implementation: Covers the development of an annual borrowing plan, access to the capital markets, hedging and the functioning of the primary and secondary markets.
- Management of contingent liabilities: Focuses on developing models to identify, measure and manage risks arising from sovereign loan guarantees, guarantees issued to public private partnership schemes, legal claims against the government, catastrophic and other risks.
- Asset and liability management: Management of the balance sheet risks (fiscal risks) from an asset and liability management perspective where market-based mitigation is possible.
GDRM Program Approach
Designed for the medium term, the GDRM Program supports partner countries from upstream, diagnostic work and developing reform plans, to downstream implementation of the plans.
The right expertise
The core team consists of public debt management professionals who have held positions in public debt offices in emerging and developed countries. They embody the World Bank Treasury’s asset management expertise, market transactions and banking solutions know-how, as well as reserves advisory and management capability. As seasoned practitioners, speaking the same technical language as their country partners, they provide pragmatic solutions in advanced areas such as issuance in international capital markets, use of derivatives, market-, credit- and operational-risk management, and contingent liabilities management.
Know your partners
Once a country becomes part of the GDRM Program, dedicated debt managers build and manage long-term relationships with partner countries’ management and technical teams. They support their counterparts in all debt management related issues, giving trusted advice, becoming a sounding board, and providing much needed continuity. As they develop a deep understanding of the country’s context, they recommend tailor-made solutions, specific to countries needs and national priorities.
The Program connects countries facing similar issues, providing a platform for an in-depth exchange of ideas and experiences. Peer Group Dialogues provide a cost-effective way to discuss challenges and policy actions on a virtual platform. South-South Collaboration promotes in-depth engagement by multi-country authorities and WBG experts to tackle common reform priorities.
The GDRM Program is focused on sustainable outcomes. It not only allows time for diagnostic work and plan recommendations, but also time to support the client through implementation, achieving change within the partner country and seeing the reform plans take root.