Debt Sustainability Framework for Low Income Countries

Overview

The LIC DSF was developed by the IMF and the World Bank (WB) to help low-income countries achieve their development goals while minimizing the risk of debt distress. This one-module course will allow you to understand the LIC DSF, and thus interpret the LIC DSF outputs presented in WB and IMF reports. The course walks you through the steps involved in applying the LIC DSF. First, we identify data requirements and the “realism tools” used for assessing the plausibility of macroeconomic projections. You will next understand how the LIC DSF computes a country’s debt-carrying capacity, which is used for determining thresholds for the debt-burden indicators. When a debt-burden indicator breaches its threshold under either the baseline or stress test scenarios, this signals risk of debt distress. The course concludes with exploring how judgment can be used to arrive at a final risk rating.

Taught by

Leonardo Martínez

Reviews

4.0 rating, based on 1 Class Central review

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Kohei I @Kohei

Overall, this was an excellent introduction to debt distress analysis for low income countries. While the course is relatively short, materials are covered with a good level details. Starting from the very basics, the course introduces how risk ra…

Overall, this was an excellent introduction to debt distress analysis for low income countries. While the course is relatively short, materials are covered with a good level details.

Starting from the very basics, the course introduces how risk ratings are generated, by comparing debt burden indicators under the baseline and stress test scenarios against the threshold. With some details, it explores how to check the reliability of the baseline scenario and how the stress test scenarios and thresholds are developed. Furthermore, it discusses how judgements can contribute to the final risk rating.

What I also liked about this course is that the technical terms were explained in a plain easy to understand English.

However, one of the caveat was that the discussion forum was quite inactive. After I raised a question to the staff, I had no response from them.

Nevertheless, I learned a lot about debt sustainability analysis from this short course. Highly recommended.

Taught by

Tags

Marco de Sustentabilidade da Dívida para Países de Baixa Renda (LIC DSFx)

Medium-Term Debt Management Strategy

Le Cadre de viabilité de la dette pour les pays à faible revenu (CVD PFR)

Marco de Sostenibilidad de la Deuda para los Países de Bajo Ingreso (MSD PBIx)

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