Press Release: IMF Soliciting Public Comment Related to the Design of an Operational Framework for Assessing Debt Sustainability in Low-Income Countries, July 15, 2003

Report on Joint Bank-Fund Workshop on Debt Sustainability in Low-Income Countries, Washington D.C., September 11-12, 2003
October 9, 2003

Debt Sustainability in Low-Income Countries - Report on Workshops in Paris, Berlin, and Accra - May/June 2003, July 9, 2003

Debt Initiative for the Heavily Indebted Poor Countries (HIPCs)
A Factsheet

Heavily Indebted Poor Countries (HIPCs)—

Debt Sustainability in Low-Income Countries—Towards a Forward-Looking Strategy

Prepared by the Staff of the Policy Development and Review Department

Approved by Timothy Geithner

May 23, 2003

Use the free Adobe Acrobat Reader to view the full text (324 kb pdf file)


Executive Summary

  1. Introduction

  2. Lessons from the Low-Income Country Debt Crisis

  3. Defining the Problem: Beneficial Financing Versus Burdensome Debt
    1. The Financing Gap Model and Its Caveats
    2. Why Are Low-Income Countries Different?
  1. A Framework for Debt Sustainability and Borrowing Policies in Low-Income Countries
    1. Criteria for Assessing Debt Sustainability
         Flow vs. Stock Variables
         NPV vs. Nominal Debt Stocks
         Public vs. External Debt
         Vulnerability and Stress Testing
    2. Translating Debt Sustainability Into Borrowing Policies
  1. Conclusions and Next Steps

  2. Summary of Issues
Text Boxes

  1. Alternative Proposals for Defining Debt Sustainability
  2. NPV of Debt: Interpretation and Measurement
  3. Examining Debt Indicators: The Case of Bolivia
  4. Debt Dynamics in Low-Income Countries
  5. Enclave Projects


  1. HIPC Debt Burden Ratios and Per Capita Income, 1979-2001
  2. Projected and Actual External Debt Ratios in the Kyrgyz Republic, Ghana, and Pakistan, 1995-2000
  3. Cameroon: Debt Sustainability Simulations, 2002-10


  1. Income and Debt Indicators for PRGF-Eligible Countries


  1. Debt Dynamics in Low-Income Countries