IMF Seminar: Debt Sustainability Assessments and their Role in the Global Financial Architecture

September 5, 2024 | IMF HQ1, Washington, D.C.

Debt Sustainability Analyses (DSAs) are central to the global financial system and the characterization of debt crises. They are the barometer that measures when countries’ debt burdens are excessive. For countries undergoing debt restructurings, DSAs impact decisions on whether debt relief goes deep enough to resume growth, meet development and climate goals and avoid extension or reemergence of debt vulnerabilities in the near term. In doing so, DSAs have implications for the interests of creditors, sovereign borrowers and their societies.

Since 2010, developing countries’ debt burdens and vulnerabilities have been on the rise, a trend exacerbated by the pandemic, interest rate hikes and other shocks. The methodology for assessing debt sustainability plays a pivotal role in the international community’s cooperation towards debt crisis responses and their prevention.

At this special seminar for Executive Directors' offices of the IMF and World Bank, debt sustainability practitioners presented and discussed the findings and recommendations of a new paper series commissioned by the Friedrich-Ebert-Stiftung (FES) New York Office and Jubilee USA Network.

The papers focus on feasible proposals to reform the IMF-World Bank Debt Sustainability Analysis framework and implementation for both low- and middle-income countries. They benefitted from a series of roundtables and peer review from other practitioners and experts, as well as a workshop with IMF and World Bank staff in charge of performing DSAs. The authors include Joseph Stiglitz and Martin Guzman from Columbia University, Sherillyn Raga from ODI, Matthew Martin from Development Finance International and Gail Hurley, an independent researcher and long-time debt sustainability analyst, most recently with UNDP.

The meeting was held under Chatham House rule.

Welcome

• Michael Bröning, Executive Director, Friedrich-Ebert-Stiftung New York

Introduction

• Sara Burke, Senior Policy Analyst, Friedrich-Ebert-Stiftung New York
• Aldo Caliari, Senior Director of Policy and Strategy, Jubilee USA Network

Authors’ Panel & Paper Presentation

• Sherillyn Raga, Research Fellow, ODI and Dirk Willem te Velde, Director, International Economic Development Group, Principal Research Fellow, ODI; “An Appraisal of Debt Sustainability Analyses Amid Multiple Crises”
• Gail Hurley, Independent Development Finance Expert, former Policy Specialist on Development Finance at the United Nations Development Programme (UNDP);  “How Transparency Makes Debt Sustainability Analyses a Trusted and Effective Tool”
• Matthew Martin, Director, Development Finance International; “How to Ensure Debt Sustainability Accelerates Sustainable Development”
• Martín Guzmán, Professor, Columbia University School of International and Public Affairs; Co-President, Initiative for Policy Dialogue (IPD); “The Practice of Sovereign Debt Sustainability Analysis”