Debt Sustainability Framework for Low Income Countries (LIC DSFx)

Source details

Canonical URL: Debt Sustainability Framework for Low Income Countries (LIC DSFx)

Target audience:
- Officials from ministries of finance
- Debt agencies
- Central banks
- Other government agencies responsible for providing advice or implementing macroeconomic and debt policies
Qualifications:
- Some knowledge of economics would be helpful
- Basic Microsoft Excel skills are essential

Provides an overview of the World Bank-IMF Debt Sustainability Framework for Low Income Countries (LIC DSF)
Purpose of the LIC DSF:
- Help low-income countries achieve their development goals while minimizing the risk of debt distress
Instructional progression:
- Identify data requirements and the "realism tools" used for assessing the plausibility of macroeconomic projections
- Explain how the LIC DSF computes a country's debt-carrying capacity, which determines thresholds for debt-burden indicators
- Show how breaches of thresholds under baseline or stress test scenarios signal risk of debt distress
- Explore the use of judgment to arrive at a final risk rating
Outcome orientation:
- Enables participants to interpret LIC DSF outputs presented in WB and IMF reports

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

Identify data requirements for the use of the LIC DSF template
Identify the steps in the production of debt risk ratings for low-income countries
Analyze the LIC DSF realism tools
Interpret the LIC DSF stress test scenarios
Identify how the LIC DSF computes thresholds for debt-burden indicators
Interpret the outputs of the debt sustainability analysis for low-income countries, as presented in WB and IMF reports