Basic Course on Public Debt Management:
Principles, Practices and Institutional Foundations
Training Introduction:
Public debt is an essential tool for financing development, managing economic shocks, and supporting fiscal policy. However, without proper planning, execution, and oversight, debt can become a major source of economic vulnerability. This foundational training course is designed to equip early-career professionals and government officials with the core concepts, tools, and institutional practices of modern public debt management.
Participants will gain an understanding of the objectives, instruments, legal frameworks, operational structures, and risk factors associated with debt management. The course emphasizes practical knowledge and builds a strong foundation for further specialization in debt strategy, risk analysis, or legal and financial operations.
Training Objectives:
- Understand the fundamental principles and objectives of public debt management.
- Learn key practices in debt recording, reporting, and strategy formulation.
- Identify the roles of institutions involved in debt management.
- Explore the legal and policy frameworks that support sound debt operations.
- Build foundational skills for effective and accountable debt management.
Target Audience:
- Junior staff in debt management offices (DMOs)
- Ministry of Finance and Treasury staff
- Central bank and budget officials
- Economists and public financial management trainees
- New hires in international financial institutions or donor organizations
Course Content
Module 1: Introduction to Public Debt and its Role in Public Finance
- Definition of public debt
- Role of debt in economic development and fiscal policy
- Debt as a financing tool: benefits and risks
- Overview of sovereign debt in developing and advanced economies
Module 2: Objectives of Public Debt Management
- Ensuring debt sustainability
- Minimizing cost and risk
- Supporting macroeconomic stability
- Transparency and accountability
Module 3: Types of Public Debt Instruments
- Domestic vs external debt
- Bonds, loans, T-bills, promissory notes
- Short-term vs long-term instruments
- Fixed vs floating rate instruments
Module 4: Institutional Framework for Debt Management
- Key institutional actors: Ministry of Finance, Central Bank, Parliament
- Role of Debt Management Offices (DMOs)
- Separation of front, middle, and back office functions
- Importance of coordination and oversight
Module 5: Legal and Regulatory Framework
- Laws governing borrowing and guarantees
- Approval processes and institutional mandates
- Debt ceilings and borrowing limits
- Transparency and reporting obligations
Module 6: Debt Recording and Management Information Systems
- Importance of accurate debt data
- Introduction to debt databases and systems (e.g., DMFAS, CS-DRMS)
- Elements of a good debt recording system
- Data quality, integrity, and security
Module 7: Budget Linkages and Fiscal Policy Coordination
- Debt and the budget cycle
- Medium-Term Fiscal Frameworks (MTFF)
- Public investment financing through debt
- Debt service and budget planning
Module 8: Sources of Public Borrowing
- Multilateral and bilateral loans
- International capital markets
- Domestic borrowing mechanisms
- Grant vs loan financing
Module 9: Basic Debt Sustainability Analysis (DSA)
- What is debt sustainability?
- Key debt ratios and indicators
- Introduction to DSA tools
- Interpreting sustainability thresholds
Module 10: Introduction to Debt Strategy Development
- Importance of a debt strategy
- Objectives and components of a Medium-Term Debt Management Strategy (MTDS)
- Role of cost-risk trade-offs
- Aligning strategy with macroeconomic policy
Module 11: Debt Issuance and Market Operations
- Primary and secondary markets
- Auctions and syndications
- Role of dealers and underwriters
- Promoting domestic debt market development
Module 12: Debt Servicing and Settlements
- Debt service components: principal, interest, fees
- Payment scheduling and execution
- Managing payment defaults
- Role of the back office
Module 13: Debt Reporting and Transparency
- Importance of public reporting
- International standards and reporting templates (e.g., IMF QEDS, WB DRS)
- Debt bulletins and investor communications
- Open data and citizen engagement
Module 14: Risks in Public Debt Management
- Market risk: interest rate and exchange rate
- Liquidity and refinancing risk
- Operational and legal risks
- Introduction to risk mitigation tools
Module 15: Oversight, Auditing, and Accountability Mechanisms
- Role of Supreme Audit Institutions (SAIs)
- Internal controls and audits
- Parliamentary oversight
- Civil society monitoring
Module 16: Country Case Studies and Group Simulation
- Comparative practices from developing and developed countries
- Lessons from debt crises and success stories
- Group simulation: preparing a basic debt profile and risk overview
- Presentation and discussion
Assessment & Certification
- Short quizzes after each module
- Group simulation or case presentation
- Final evaluation test
- Certificate of Completion upon successful participation
