Commonwealth Ministerial Debt Sustainability Forum

22 April, 2009

Summary of the ReportObjective: present Commonwealth countries’

capacity building needs.Outline of the report:

1.- Looks into the two main current capacity building assessment methodologies: HIPC-CBP (1998) and The World Bank (2007)

2.-provides the latest capacity building needs by CBP countries (2008). Commonwealth members and OIF members, and then proceeds to a more detailed analysis of the Commonwealth countries.

3.-The last section of the report seeks to share the capacity building activities planned for the Commonwealth countries based on the analysis provided in the previous section.

Overall ConclusionsNeed of additional financing to accelerate

debt strategy capacity-building, especially in the context of the global financial crisis.

Donor-funded assistance will achieve little without strong commitment by developing country governments to improve legal and institutional frameworks, and to use national capacity rather than external technical assistance.

Overall Conclusions IISeveral actions are suggested to improve the

assessment and response of the international community to country capacity-building needs: 1. Assessments of country needs should be: a)

comprehensive and objective, b) with clear scoring and evaluation systems, c) conducted by the countries themselves to maximize ownership, d) quality controlled. They should be conducted regularly (annually) in order to track progress and provide donors and implementing org. with a means of assessing success.

2. Assessments should be combined with the diagnosis of capacity gaps and potential solutions, and the construction of national capacity-building plans

Overall Conclusions IIIIn terms of areas:The top need is still to build capacity in “middle-

office” analytical functions, notably on domestic debt market development and new external financing strategy.

Countries also need major capacity-building investments on macroeconomic forecasts, budget expenditure forecasting and risk management (new requirement), all of which are essential aspects of debt strategy formulation and policy coordination, to cope with new sustainability methodology

Commonwealth countries in particular need technical training in portfolio and risk analysis, domestic debt strategy and external new financing strategy.

Final Overall Conclusions IVRecommendations for the successful implementation of

a long-term capacity-building programme: Passing laws which give debt management staff a clear

mandate to produce, approve ,disseminate and implement annual debt strategies

Updating laws to ensure that they cover all aspects of debt strategy (including domestic debt, contingent liabilities, decentralized debt, and more sophisticated instruments such as PPP agreements)

Designing more comprehensive capacity-building plans, carefully selecting staff participating at training events, to fulfill the needs and career paths of each staff member.

Making clear Government commitment to reducing dependency on external assistance, by refusing TA while implementing the capacity-building plan.

Guyana CCE: Logframe Scores

Logframe Scores

Baseline Current Scores Target

Section 1 – HIPC CBP Logframe Targets

I. LTI. Debt sustainability 3.00 4.00 3.00

II. MTI 2a. Strategy updated regularly. 2.80 3.00 3.80

III. MTI 2b. Legal and institutional framework 2.20 2.20 3.40

IV. STI 3a. Trained personnel 2.00 3.00 3.00

VI. STI 3c. Capacity Building Plans (updated) 1.00 1.00 3.40

Average 2.00 2.30 3.40

Guyana: Needs and interventionsPriority needs :Updating its debt strategy, getting it approved and

implementedIncreasing the number of national experts availableFinalize the debt legal frameworkUpdating and approve a national a capacity building planFamiliarize with new BWI toolsInterventions envisaged for 2009A National Workshop to update the strategy and increase the

number of national expertsA sensitization seminar to facilitate the exchange of ideas and

coordination between the different agencies in charge of the design and implementation of the strategy

A mission to assist Guyana in finalizing the debt act.Coordinate with BWI capacity building activities for new tools

Cameroon: Needs and interventionsPriority needs :training members of the Debt Committee on the

design of global debt strategies combining the CBP methodology with that of the DSF

Increasing the number of national experts availabletraining staff on cash management and domestic debt

strategies, to prevent future domestic debt crises. Familiarize with new BWI toolsInterventions envisaged for 2009Reg. Workshops on Global debt strategy and BWI tools

(DSF, DeMPA, and MTDS)Join training on Cash Mngmt. and designing strategy

for issuing national bonds. Debt audit and use of CS-DRMS for dom debt

recording

The Gambia: Needs and InterventionsPriority needs :updating its national debt strategy using LIC DSF

with emphasis on new financing and domestic debt strategies.

continued training in all technical areas including basic debt management;

redrafting of the Loans Act, new borrowing guidelines and drawing up of national capacity building plans.

Increasing the number of national experts available

The Gambia: Needs and InterventionsInterventions envisaged for 2009Debt Adiverser hired by The Gambian

Government – address issues basic training on debt management, legal framwork for debt etc

National Debt Strategy Analysis W-Shop using LIC DSF 3rd Quarter 2009

Participation at wks. Middle Office Oper. and risk mgt, Domestic debt, CS-DRMS, legal aspects of debt management

Rgl DSF-LIC workshop

Ghana: Needs and InterventionsPriority needs :Strengthen training staff in designing the national debt

strategy with particular emphasis on new financing and domestic debt strategies,

training staff in risk modeling for the sovereign debt portfolio, training more staff on DEMPA, DSF LIC and MTDS; legal aspects of debt management Interventions envisaged for 2009Participation at wks. Middle Office Oper. and risk mgt in

Ghana, legal aspects of debt managementConducting MTDS with IMFDSF-LIC Workshop Staff atachment in addition Staff also are on DLP

Sierra Leone: Needs and InterventionsPriority needs :to consolidate its pool of national experts on DSA. to update its national debt strategy regularly with particular

emphasis on risk analysis and domestic debt strategies. to review its institutional and especially legal framework Interventions envisaged for 20094 officials are on DLP to strengthen pool of experts in DSADSA is planned for July 2009Participation at wks. Middle Office Oper. and risk mgt,IMM mission to S/Leone and w/shop onlegal aspects of debt

managementDSF LIC regnal Wshop

Kenya: Needs and InterventionsPriority needs :Training more staff in the design of the national debt

strategy, making sure it is approved, and fully implemented as well as updated regularly.

Improving the legal and institutional framework for debt and new financing management,

linking the overall national capacity-building plan to individual training needs.

Interventions envisaged for 2009national debt strategy workshop and a sensitization

seminar. A follow-up mission to support strategy implementation.

Incorporating MTDS results into Nat. Debt Strategy

Malawi: Needs and Interventions

Priority needs :Review of country’s debt and aid strategyEnhancing capacity to use BWI LIC DSF and MTDSIncreasing capacity in use of CS-DRMS, especially

auctioning module

Interventions envisaged for 2009Regional training on BWI toolsMission to review Debt and aid strategyRegional training in CS-DRMS

Mozambique: Needs and InterventionsPriority needs :Increasing the number of national experts available to

design and implement a National Debt StrategyEnsuring the National Strategy is approved and fully

implementedImproving capacity in back office Familiarize with new BWI toolsInterventions envisaged for 2009National debt strategy workshop and sensitization

seminar Proposed training on back office skillsAttending regional courses on BWI tools

Tanzania: Needs and InterventionsPriority needs :Increasing the number of national experts available to

formulate new financing and domestic debt strategyIncreasing capacity in risk management Familiarize with new BWI tools (DeMPA, DSF and MTDS)Linking NCBP to individual training needsFurther capacity in CS-DRMSInterventions envisaged for 2009National debt strategy workshop and approval

seminarInstitutional support mission to improve Institutional

frameworkIn-country training in CS-DRMS

Uganda: Needs and Interventions

Priority needs :Ensuring implementation of debt strategy and updating

the strategy to take into account the new financing issuesIncreasing the number of national experts versed in risk

modellingImproving Institutional framework for debt managementFamiliarize with new BWI toolsInterventions envisaged for 2009Follow up institutional support mission Risk modelling projectRegional workshops on BWI tools

Zambia: Needs and Interventions

Priority needs :Increasing the number of national experts

available to design and implement debt strategiesReview and update the national debt strategyFamiliarize with new BWI toolsLinking NCBP to individual training needsInterventions envisaged for 2009Follow up institutional support mission and

sensitization seminar to decision makersRegional workshops on BWI tools