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 policymakers 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.

An initial set of Draft Guidelines was prepared jointly by the staffs of the Fund and the World Bank, and was placed on the external websites of the IMF and World Bank in August 2000 in five languages: Arabic, English, French, Russian, and Spanish.

In order to gather feedback from a large group of officials from member countries, including those responsible for macroprudential policies, the staffs of the Fund and the World Bank held five regional outreach meetings in Chile, China (Hong Kong SAR), South Africa, United Arab Emirates, and the United Kingdom. Fund and 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.

On the basis of the feedback received at the meetings, the Guidelines were presented for discussion to the Executive Directors of the World Bank on March 6, 2001, and to the Executive Board of the Fund on March 16, 2001. Directors in both institutions welcomed the Guidelines as a valuable instrument to assist countries in their efforts to improve their debt management practices and reduce financial vulnerability.

Bank and Fund staffs made final changes to the Guidelines to reflect Executive Directors' comments. The management of the Fund and Bank will forward the final Guidelines on Public Debt Management to the IMFC and the Development Committee respectively at their spring 2001 meetings in Washington. Fund and World Bank Executive Boards requested the staffs of the two institutions to prepare, in due course, an accompanying report that would contain sample case studies of countries that have developed strong systems of public debt management.