Institute debt management strategies to boost economic growth, ECA urges member states

“However, this provides an opportunity to e ectively enact budgetary protection for various events more apparent in the foreseeable future,” Mr. Elhiraika said, adding that, “E cient and effective debt management will allow debtor countries to take action to avoid the legacy of ‘too little, too late’ sovereign debt management and restructuring.”

The ECA is hosting a capacity building workshop for senior government o cials in an e ort to enhance countries' scal prudence. The workshop is to assist delegates from Ethiopia, Sierra Leone, South Africa, Sudan and Zambia share information, experiences and best practices on debt management strategies, policies and operations to enable them to implement viable debt management procedures and strategies.

Mr. Elhiraika said in the past six decades, every global recession has led to a rise in global government debt and over the past decade, many countries in Africa have increased their public debt levels. Most of the current public debt was accrued during the scal years of 2020 and 2021, when countries took on debt to deal with the e ects of the Covid-19 pandemic.

The ECA notes that during an economic crisis, continued borrowing has led to high debt accumulation, dwindling the government's capacity to e ectively manage public debt. Debt distress has been aggravated by huge current account de cits, massive redemption schedules, and lack of access to conventional lending markets. Countries often rely on debt as an instrument for nancing growth and development.

During the workshop, delegates will present the current state of debt in their countries and highlight the key challenges hampering debt sustain- ability. In addition, they will discuss debt sustainability analysis procedures and medium-term management strategies and enhance the capacity of public debt managers to evaluate the structure, dynamics, and risks of sovereign debt portfolios.

Sharing experiences with debt management, Joseph Thullah and Mohamed Samura from the Public Debt Division in the

Ministry of Finance, said Sierra Leone had implemented a number of debt and risk management strategies such as debt exchanges and debt buy-backs to manage and reduce government re nancing risks.

Sierra Leone was continuing to prioritize mobilization of grants over loans and ensure that new borrowings meet the concessionality threshold of a minimum of 35 percent grant element. Ethiopia implemented a medium-term debt management strategy from 2016-2020 which helped in assessing cost and risk of borrowings and ensured debt sustainability.

Habtamu Alamayo, Programme O cer, Ministry of Finance, Ethiopia, said despite challenges, such as poor export performance, low FDI