2013年-世界发展银行全球_Debt_Management_Performance_Assessment___Ethiopia_33页_1mb

Summary of Debt Management Performance Assessment in Ethiopia

Core Content

The Debt Management Performance Assessment (DeMPA) is a methodology used to evaluate the effectiveness of a country's debt management operations. This report presents the findings of a World Bank mission conducted in Ethiopia in March 2013, assessing the country's debt management performance using the DeMPA tool. The assessment is based on 15 performance indicators (DPIs), each with dimensions that evaluate specific aspects of debt management. The scores are assigned on a scale from A (sound practice), B (intermediate), C (minimum requirements), and D (not meeting minimum requirements), with N/R (not rated) for dimensions that could not be assessed.

The report highlights both strengths and weaknesses in Ethiopia's debt management system, with a focus on governance, coordination with macroeconomic policies, borrowing activities, cash flow management, operational risk management, and debt records and reporting. The assessment also notes the country's engagement with various technical assistance programs and its alignment with broader development strategies such as the Growth and Transformation Plan (GTP).

Main Findings

Governance and Strategy Development

• DPI-1: Legal Framework – Score: C

  • The legal framework is detailed and thorough, with mandates clearly defined in the Federal Government of Ethiopia Financial Administration Proclamation No. 648/2009.
  • The Minister of Finance is the only entity authorized to borrow money or issue guarantees on behalf of the Government of Ethiopia (GOE).
  • The Proclamation outlines the purposes for borrowing, including the efficient management of the consolidated fund, loan repayments, and direct advances.
  • While the legal requirements are met, the primary legislation does not explicitly include debt management objectives, which is necessary for a score of B.

• DPI-2: Managerial Structure – Score: C

  • Several government entities are involved in debt management, including the Ministry of Finance and Economic Development (MoFED), the National Bank of Ethiopia (NBE), and the Debt Management Directorate (DMD).
  • The DMD is the leading entity for debt recording, reporting, and analysis.
  • There is no formal debt management strategy in place, which is a requirement for a higher score.

• DPI-3: Debt Management Strategy – Score: D and N/R

  • The quality of the debt strategy document is low, and no formal strategy has been developed yet.
  • A strategy is currently being drafted and is expected to be approved by the Minister of Finance and made publicly available.

• DPI-4: Evaluation of Debt Management Operations – Score: C

  • There is an evaluation process in place, but it is not comprehensive enough to warrant a higher score.

• DPI-5: Audit – Score: D and N/R

  • Financial audits are conducted, but performance audits of debt management operations are not yet completed.
  • There is no formal response to audit findings, which is a key requirement for a higher score.

Coordination with Macroeconomic Policies

• DPI-6: Coordination with Fiscal Policy – Score: B and A

  • There is good provision and quality of debt-service forecasts.
  • High-quality information on key macroeconomic variables and debt sustainability analysis (DSA) is available.

• DPI-7: Coordination with Monetary Policy – Score: D, D, and D

  • No clear separation between debt management and monetary policy operations.
  • No regular information sharing between the central bank and the debt management office.
  • Central government access to central bank financing is not limited by law, which is a risk to fiscal discipline.

Borrowing and Related Financing Activities

• DPI-8: Domestic Borrowing – Score: D and B

  • Market-based borrowing is not used for all domestic borrowings.
  • Documented procedures for domestic borrowing are available, but not fully utilized.

• DPI-9: External Borrowing – Score: A, A, and A

  • Borrowing plans and cost assessments are well-documented.
  • Procedures for external borrowing are clear and comprehensive.
  • Legal advisers are involved in all loan negotiations.

• DPI-10: Loan Guarantees, On-lending, and Derivatives – Score: B, B, and N/R

  • Documented policies and procedures for loan guarantees and on-lending exist.
  • Derivatives are not yet covered by formal procedures.

Cash Flow Forecasting and Cash Balance Management

• DPI-11: Cash Flow Forecasting and Cash Balance Management – Score: D and C
  • Effective cash flow forecasting is lacking.
  • Cash balance management is partially in place, with annual and monthly forecasts prepared.

Operational Risk Management

• DPI-12: Data Administration and Data Security – Score: C, D, B, and A

  • Documented procedures for debt service exist.
  • Data recording and storage procedures are not fully documented.
  • Data security is adequate, with backup frequency and storage security meeting high standards.

• DPI-13: Segregation of Duties, Staff Capacity, and Business Continuity – Score: D, B, and D

  • Segregation of duties is not well implemented.
  • Staff capacity is adequate, with detailed job descriptions.
  • Business continuity and disaster recovery plans are not in place.

Debt Records and Reporting

• DPI-14: Debt Records – Score: B and D

  • Debt records are complete and timely for central government debt.
  • Registry system for Treasury bills is not maintained in electronic form.

• DPI-15: Debt Reporting – Score: B, A, and C

  • Central government debt reporting meets statutory requirements.
  • Public sector debt reporting is comprehensive.
  • The Debt Statistical Bulletin is published but not of high quality.

Key Information

• The DeMPA assessment was conducted in March 2013 by a World Bank mission team.
• The GTP is a key development strategy that emphasizes the need for improved debt management to support public investment and fiscal sustainability.
• Ethiopia has made progress in legal frameworks and internal audit systems, but lacks a formal debt management strategy.
• The central government has not established a single treasury account, leading to inefficient cash balance management.
• Operational risk management is not yet formalized, with limited segregation of duties and no disaster recovery plans.
• The Debt Management and Financial Analysis System (DMFAS) is in place but data recording and storage procedures are not fully documented.
• The Debt Statistical Bulletin is published but needs improvement in quality and timeliness.
• The GOE has conducted annual DSAs without external assistance, demonstrating some level of internal capability.
• Technical assistance from the World Bank, IMF, and UNCTAD has contributed to the development of debt management systems and procedures.

Priority Areas for Reform

• Development of a formal debt management strategy.
• Improvement of debt records and reporting systems.
• Implementation of a single treasury account.
• Formalization of operational risk management.
• Strengthening of internal audit systems and response to audit findings.
• Establishment of business continuity and disaster recovery plans.
• Segregation of duties and enhanced coordination between debt management and monetary policy operations.