Projecting Public Debt - The Public Debt Dynamics Tool

Source details

Target Audience:
- All government officials are welcome to register.
- Particularly useful for officials from ministries of finance, debt agencies, central banks, and other government agencies responsible for implementing macroeconomic and debt policies.
Qualifications and technical requirements:
- Some knowledge of economics would be helpful.
- Basic Microsoft Excel skills.
- Access to a computer with a reliable internet connection and a Google Chrome web browser are essential.

Structure:
- Two-module online course presented by the Institute for Capacity Development.
Analytical focus:
- Explains how to project the stock of public debt over time for baseline (most likely) and alternative scenarios.
- Explains how to estimate the path of fiscal adjustments necessary to reach a pre-determined target level of debt.
Tool and variables:
- Teaches application of concepts using an easy-to-use Excel-based Public Debt Dynamics Tool (DDT).
- Uses projections of some 10 key macroeconomic and financial variables.
Outputs and functionalities of the DDT:
- Provides public debt projections under baseline and stress test scenarios.
- Produces fan charts that describe uncertainty about the evolution of debt over time in a probabilistic manner.
- Identifies the main drivers of public debt changes.
- Computes measures of fiscal adjustments necessary to achieve a public debt target during a certain period, as specified by the user.

Upon completion of this course, participants should be able to:

Compute public debt dynamics.
Identify the main drivers of public debt dynamics.
Compute measures of fiscal adjustments necessary to achieve a public debt target.
Conduct a stress test to public debt dynamics, including through the use of fan charts.
Identify the main components of a debt sustainability analysis to assess the risk of debt distress.