2010年-世界发展银行全球_Debt_Management_Performance_Assessment___Guinea-Bissau_28页_8mb

Debt Management Performance Assessment (DeMPA) Summary - Guinea-Bissau

Core Content

The Debt Management Performance Assessment (DeMPA) is a tool used by the World Bank to evaluate the effectiveness of public debt management practices in a country. This report assesses Guinea-Bissau's debt management performance as of September 4, 2009, using a set of 15 indicators. The assessment highlights both the challenges and progress in the country's debt management framework, particularly in the context of its political instability, weak economic performance, and high levels of debt distress.

Key Findings

• Overall Context:
  Guinea-Bissau has been affected by political turmoil and weak economic performance, leading to a poor public administration environment. The country joined the West African Economic and Monetary Union (WAEMU) in 1997 and uses the CFA Franc as its currency. It is one of the poorest countries in the world, ranked 171st out of 179 in the Human Development Index (HDI).

• Debt Situation:

  • External Debt: As of end-2008, the nominal stock of public and publicly guaranteed external debt was US$1,040 million (246% of GDP), with US$383 million in arrears.
  • Domestic Debt: Domestic liabilities were estimated at CFAF 144 billion (70% of GDP), with 60% in arrears, including to the regional central bank (BCEAO) and WAEMU banks.

• Debt Management Practices:

  • The government is highly dependent on budget support due to low revenue capacity and an ambitious poverty reduction program.
  • Guinea-Bissau has not yet met the minimum requirements for most DeMPA indicators, but some areas show progress or are close to meeting the standards.

Main Indicators and Scores

Governance and Strategy Development

• DPI-1: Legal Framework

  • Score: C
  • The legal framework for debt management is in place, with the Ministry of Finance (MoF) having exclusive authority over financial obligations. However, it lacks a comprehensive debt management strategy.

• DPI-2: Managerial Structure

  • Score: C for the first dimension, N/R for the second
  • The MoF manages both domestic and external debt, but there is no formal structure for loan guarantees.

• DPI-3: Debt Management Strategy

  • Score: D for the first dimension, N/R for the second
  • There is no explicit debt management strategy. The government is limited to highly concessional financing sources due to debt distress.

• DPI-4: Evaluation of Debt Management Operations

  • Score: D
  • The SDP provides monthly debt data, but there is no formal annual report or policy-oriented analysis of outcomes.

• DPI-5: Audit

  • Score: D for the first dimension, N/R for the second
  • Internal and external audits have not been conducted on debt management activities, and no audit reports have been published.

Coordination with Macroeconomic Policies

• DPI-6: Coordination with Fiscal Policy

  • Score: C for the first dimension, D for the second
  • The SDP provides debt service forecasts, but there is no medium-term framework or formal debt sustainability analysis.

• DPI-7: Coordination with Monetary Policy

  • Score: A for all dimensions
  • The BCEAO is the monetary policy agent and separates its operations from debt management. There is regular coordination through information sharing and meetings.

Borrowing and Related Financing Activities

• DPI-8: Domestic Borrowing

  • Score: D for the first dimension, B for the second
  • The country issues T-Bills but not T-Bonds. The borrowing plan is not formalized, and market participants are not informed in advance.

• DPI-9: External Borrowing

  • Score: D for the first and second dimensions, C for the third
  • The government does not assess the most beneficial borrowing terms or have documented procedures for external borrowing. Legal advisors are involved in the process.

Key Challenges

• Implementation of a Debt Strategy: The absence of a formal debt management strategy hampers effective planning and execution.
• Operational Risk Management: There is a need for stronger risk management practices.
• Cash Management: Weak cash management practices are evident, particularly in the context of domestic debt.
• Staff Capacity: Limited capacity for analytical work and debt management expertise requires capacity-building efforts.

Recommendations and Next Steps

• The government should develop a comprehensive debt management strategy.
• Strengthen operational risk management and cash management practices.
• Implement formal debt sustainability analysis and improve the quality of debt reporting.
• Enhance internal and external audit processes to ensure transparency and accountability.
• Increase staff capacity through training and technical assistance.
• Improve communication with market participants regarding borrowing plans and procedures.

Conclusion

Guinea-Bissau's debt management performance is constrained by its political and economic challenges, but it has met or exceeded minimum requirements in some areas. The DeMPA assessment highlights the need for institutional and procedural improvements to ensure sustainable and transparent debt management practices. The government is encouraged to take proactive steps in developing a strategy, improving coordination with macroeconomic policies, and enhancing staff capacity. Technical assistance from international donors and institutions can play a crucial role in supporting these reforms.