Summary of the Debt Management Guidelines

• Pages: 259-261

Page 259

1. Debt management objectives and coordination

1. 1 Objectives

The main objective of public debt management is to ensure that the government's financing needs and its payment obligations are met at the lowest possible cost over the medium to long run, consistent with a prudent degree of risk.¹

1. 2 Scope

Debt management should encompass the main financial obligations over which the central government exercises control.

1. 3 Coordination with monetary and fiscal policies

Debt managers, fiscal policy advisers, and central bankers should share an understanding of the objectives of debt management, fiscal, and monetary policies given the interdependencies between their different policy instruments. Debt managers should convey to fiscal authorities their views on the costs and risks associated with government financing requirements and debt levels.

Where the level of financial development allows, there should be a separation of debt management and monetary policy objectives and accountabilities.

Debt management, fiscal, and monetary authorities should share information on the government's current and future liquidity needs.

2. Transparency and accountability

2. 1 Clarity of roles, responsibilities, and objectives of financial agencies responsible for debt management

The allocation of responsibilities among the ministry of finance, the central bank, or a separate debt management agency for debt management policy advice, and for undertaking primary debt issues, secondary Page 260 market arrangements, depository facilities, and clearing and settlement arrangements for trade in government securities, should be publicly disclosed.

The objectives for debt management should be clearly defined and publicly disclosed, and the measures of cost and risk that are adopted should be explained.

2. 2 Open process for formulating and...