Managing Director Remarks' at the IMF Conference on Public Debt Transparency—Aligning the Law with Good Practices

IMF News, May 14, 2025

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Canonical URL: Managing Director Remarks' at the IMF Conference on Public Debt Transparency—Aligning the Law with Good Practices

Speaker: Kristalina Georgieva, Managing Director, IMF.
Event date: May 14, 2025.
Core message: Debt transparency is a public good essential to managing rising global public debt, improving investor confidence, reducing borrowing costs, and protecting debt sustainability.

Global public debt is expected to approach 100 percent of global GDP by the end of the decade.
The current debt burden is "worse than what we had during the pandemic."
Emerging markets and developing economies face particular strain as the mounting cost of servicing debts squeezes investment and shock response capacity.
New and complex financing forms (guaranteed, securitized and collateralized debt contracts linked to public-private partnerships, state-owned enterprises and pension funds) are increasing opacity and hiding debt from policymakers and the public.
Hidden debt consequences: saps investor confidence, increases borrowing costs, and puts debt sustainability at risk.

Debt transparency identified as a public good; substantial Fund work on global debt architecture and sovereign debt restructurings since the pandemic.
Initiatives referenced:
- G20 Common Framework and its evolution toward greater efficiency and inclusivity.
- Creation and engagement of the Global Sovereign Debt Roundtable.
- Publication and use of the Sovereign Debt Restructuring Playbook to speed restructuring, define accountability, and compile data on domestic and external debt and creditors.
Relevant IMF outputs and actions:
- 2023 paper: “Making Public Debt Public” — found debt disclosure in borrowing low-income countries and emerging market economies falls way short, largely due to the increasing share of non-marketable and SOE debt; gaps in domestic, legal, institutional, and operational frameworks hinder transparency.
- Debt limit policies now require more detailed transparency on debt information, including for the first time the publication of the holders of a country's public debt.
- Article IV consultations now include a more structured and transparent assessment of data adequacy on debt, requiring broader and more granular debt data to inform the IMF, countries, and potential investors.
- Capacity development: delivered over 200 capacity development projects on debt management in the last two years.

IMF Legal Department reviewed debt-related legislation for 85 countries and identified areas for improvement.
Key legal framework shortcomings:
- Less than half of countries surveyed require debt management and fiscal reporting.
- Legal definitions of public debt are often too narrow, excluding SOEs or types of borrowing, which results in some debt falling outside sovereign awareness.
Critical legal questions to resolve in countries: who has authority to borrow on behalf of the country; who can sign a valid contract; can the state's resources be used as collateral?

General policy theme: "Good law drives good practices" — strengthen legal, institutional, and operational frameworks to improve transparency.
IMF commitments:
- Upcoming review of debt sustainability analysis for low-income countries will consider how to better support debt transparency; complements completion of a similar review for market access countries.
- Continued engagement in the Global Sovereign Debt Roundtable and the Common Framework to involve all relevant parties in advancing debt transparency; encourage debtors to be more transparent about debt on their books and creditors to be more forthcoming about lending purposes.
- Systematically draw lessons from experience in surveillance and capacity development to develop and share best practices in advancing debt transparency.
- Periodically report on progress in strengthening legal frameworks for debt transparencies as part of reporting on the multi-pronged approach to reduce debt vulnerability.

Conference participants include policymakers from 72 countries, civil society organizations, private sector representatives, and academia.
Call to action: "You cannot manage what you cannot see." Encourage countries to "get their own house in order" through transparency, stronger laws, and clear responsibilities for debt reporting and management.

Kristalina Georgieva, Managing Director, IMF; May 14, 2025.