New Agreement to Promote Debt Management in East and Southern Africa – UNCTAD | Vette Leader

The renewed partnership will help governments in the region produce and publish reliable, comprehensive and timely debt information.

© UNICEF Uganda/2021/Kabuye | A healthcare worker in Uganda administers a COVID-19 vaccine. Effective debt management is critical as borrowing increases to meet COVID-19 public spending needs.

UNCTAD and the Institute for Macroeconomics and Financial Management of East and Southern Africa (MEFMI), a regional institute, signed an agreement on July 15 to step up efforts to strengthen countries’ debt-management capacity.

The MoU, signed by UNCTAD Secretary General Rebeca Grynspan and MEFMI Executive Director Louis Kasekende, strengthens the collaboration between the two organizations that began in the 1990s.

“We are pleased to strengthen our partnership to improve countries’ ability to effectively collect and report public debt,” said Ms. Grynspan.

“The financial vulnerabilities and heightened risk of a debt crisis faced by developing countries due to economic shocks reinforce the need for effective debt management as a key component of public finance management,” she added.

Over 40 years of debt management support

UNCTAD provides support for effective debt management through its Debt Management and Financial Analysis (DMFAS) program.

DMFAS has been helping governments improve their ability to manage debt for over 40 years. It is one of the world’s leading providers of technical collaboration and consulting services in this field.

The program has supported 74 countries since its inception in the early 1980s. Today, 60 countries use DMFAS software to manage public debt. This includes six MEFMI member countries: Angola, Burundi, Rwanda, Uganda, Zambia and Zimbabwe.

The DMFAS program provides technical assistance in the ‘downstream’ areas of debt management, such as collecting, reporting and monitoring public debt, and helps developing countries to cope with the increasing complexity of debt management.

Its specialized products and services, including DMFAS software, complement the work of organizations focused on strategy and debt sustainability analysis (upstream debt management) such as the World Bank, International Monetary Fund and regional organizations including MEFMI.

“DMFAS has enabled countries in the MEFMI region to consolidate their data into one centralized system, which is a major achievement compared to the 1990s when this information was manually collected and distributed across many government agencies and departments that were then managed the national debt. ‘ said Mr. Kasekende.

Complementary Operations

The DMFAS program and MEFMI operate in many similar countries and their activities on the ground are complementary.

MEFMI’s strong debt management expertise and established presence in the countries of East and South Africa make it a key partner for UNCTAD in the region.

For over 30 years, DMFAS and MEFMI have offered joint debt management events for MEFMI member countries. This includes conferences, training and capacity building activities.

In 2022 they will conduct four activities including a regional workshop and training on debt management practices in Zimbabwe.

With support from UNCTAD and MEFMI, governments can produce and publish reliable, comprehensive and timely debt information and make it accessible at international, national and local levels.

This information helps countries to develop sound debt management strategies and meet their reporting obligations.

Why debt data is so important

Effective management of public resources and liabilities and the availability of transparent debt data are essential as public finances are under increasing pressure and borrowing to meet COVID-19 public spending needs is increasing.

Timely and comprehensive data on the amount and composition of debt is a prerequisite not only for effectively managing public debt, but also for identifying risks of debt crises and limiting their impact.

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