Public Debt Management in Emerging Market Economies : Has This Time Been Different?

Anderson, Phillip R. D. ; Silva, Anderson Caputo ; Velandia-Rubiano, Antonio

关键词: ASSET POSITION;    AUCTION;    AUCTIONS;    BAILOUT;    BANK FINANCING;   

DOI  :  10.1596/1813-9450-5399
RP-ID  :  WPS5399

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Despite the scale of the globalfinancial crisis, to date it has not resulted in a sovereigndebt crisis among emerging market countries. Two significantfactors in this outcome are the improved macroeconomicmanagement and public debt management in these countriesover the past decade. This paper reviews the improvements inmacroeconomic fundamentals and the composition of publicdebt portfolios in emerging market countries prior to thecrisis and concludes that the policies and strategiespursued by governments provided them with a buffer when thecrisis hit. Nevertheless, with the international capitalmarkets effectively closed for over three months anddomestic borrowing in many cases impacted by extreme riskaversion, government debt managers were required to adapttheir strategies to rapidly changing circumstances. Thepaper reviews the impact of the crisis and the responses ofdebt managers to the drying up of international capital,decreased liquidity in markets, and sharply increased termpremia. Three categories of response are identified: (i)funding from other sources to reduce pressure on marketborrowing; (ii) adapting funding programs to changes indemand in the different types of securities; and (iii)implementing liability management operations to support themarket. Most governments were willing to accept temporarilygreater risk in their portfolios, often reversing longestablished strategies, at a time when financial marketswere under stress. These actions contributed to the measurestaken by governments to stabilize markets and preventeconomies from stalling. Looking to the future, governmentdebt managers will need to consider how they can increasethe resilience of public debt portfolios for the uncertaintimes that lie ahead.