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UNCTAD and the Economic and Social Commission for Western Asia (ESCWA) and UNCTAD, have recently started a new collaboration in debt management.
The project “Sustainable Debt Financing Strategies to Enhance Fiscal Space, Provide Financing for the SDGs and Address the Repercussions of COVID-19 in the Arab Region” aims at developing debt optimization strategies through improved debt management practices, effective debt reporting and transparency, debt relief mechanisms, as well as debt sustainability in the medium and long term.
It was launched with a regional inception workshop on Developing Debt Optimization Strategies to Enhance Fiscal Space in Arab States that took place in Beirut, Lebanon on the 27th and 28th of July 2022. The project starts in a context of the historic rise in public debt in the Arab region and mounting pressures on debt sustainability and financing for the SDGs from interrelated global shocks (Covid-19, climate change and the war in Ukraine) and monetary tightening in developed countries.
“Debt in the Arab States has gone beyond 1.4 trillion in 2020 due to the adverse impact of COVID-19, and further amplified by the war in Ukraine” said Niranjan Sarangi, Senior Economic Affairs Officer at ESCWA.
Representatives from public debt departments of ministries of finance, central banks, academia, and debt experts from ESCWA and UNCTAD discussed challenges in debt management practices of the Arab States. Participants shared their debt management experience and practices during the workshop.
The importance of sound public debt management policy was highlighted as an integral part of macroeconomic policies, as well as integrating climate risks in these policies.
The challenges of public debt management, improvement of debt data quality, development of improved risk-analysis dashboards and debt sustainability analysis tools, a peer-learning platform and capacity-development assistance were identified as needs in the meeting.
In relation to debt data transparency and reporting, the DMFAS Programme presented the Debt Data Quality Assessment framework it developed jointly with the Commonwealth Secretariat to ensure that debt data is complete, accurate and timely.
UNCTAD also presented the Sustainable Development Finance Assessment (SDFA) Framework as a tool for assessing how a country could achieve the SDGs with long-run debt sustainability.
The workshop identified tools and capacity-building needs that will be used to create a road map for the implementation of the project.
Presentations made during the workshop are available here: https://www.unescwa.org/events/debt-optimization-strategies-enhance-fiscal-space
