Syndicate content

Debt management

Packing a library of knowledge in a carry-on: Attending the Public Debt Management Workshop in Vienna

Mario Augusto Caetano Joao's picture
© World Bank


I travel light. Usually a carry-on is all I need for business related travel. Attending the Government Debt Management Strategy Design and Implementation Workshops, organized by World Bank Treasury, was no different affair. The month was July, the location was JVI Facilities in Vienna, I thought I didn’t need more luggage!

I attended the workshop wearing two different hats: as a former senior economic advisor to the Angolan government and a macro economist, I was eager to find out what I could add to my information portfolio in terms of debt management know-how; as a World Bank Group Advisor to Executive Director, I was curious about how the Bank builds capacity through training for member countries.

Can debt managers save the world?

M. Coskun Cangoz's picture
© Thinkstock
© Thinkstock

It was ten years ago, right before the global crisis when Lehman Brothers had not collapsed, and Fannie Mae and Freddie Mac had not been placed into conservatorship. For debt managers, the markets were less volatile and the future was less uncertain. In Turkey we were dealing with the implementation of the post-crisis reform agenda.
 
One day, I got an invitation from my son’s eighth-grade teacher to speak at the school’s “careers day” which aims educate children on different types of jobs.  I accepted the invitation but I was a little worried because, as a debt manager I have a “different type of job” that was not necessarily an “exciting” one.

How much should Bhutan worry about debt?

Yoichiro Ishihara's picture
Bhutan hydropower
Construction of the Dagachhu Hydropower Plant in Bhutan. Photo Credit: Asian Development Bank

In many respects, Bhutan has been a development success story. Its people have benefitted from decades of sharp reductions in poverty combined with impressive improvements in health and education. The country is a global model in environmental conservation. It is the first carbon negative country; Bhutan’s forests, which cover over 70% of the country, absorb more carbon dioxide than is produced by its emissions.

The Kingdom of Happiness also must grapple with the reality of managing budgets, creating infrastructure, and preparing its citizens to be able to create and take advantage of jobs of the future. To do that, we are working with closely with Bhutan to build the foundations for a more prosperous future through the cultivation of a vibrant private sector economy and supporting green development.

At the same time, Bhutan has invested generously in hydropower energy production to create a reliable and lasting source of green energy for its people. It also benefits from exporting excess electricity to neighboring India, whose energy needs continue to increase at a rapid pace with their growing economy.

In large part due to the hydropower investments, Bhutan’s public debt was 107 percent of the Gross Domestic Product (GDP) as of March 2017. Hydropower external debt was at 77 percent of GDP with non-hydropower external debt accounting for 22 percent of GDP. Questions have arisen on whether this level of debt is sustainable and what should be done to address it.