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    Challenges On Debt Management in Developing Countries

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    Asian Development Bank - Event Documents
    The document discusses challenges in debt management for developing countries and the Philippines' strategies to address them. It aims to (1) reduce debt load through high growth, increased revenues, and lower deficits, (2) ensure financing at minimum cost and acceptable risk by improving yield curves, accessing foreign markets strategically, and utilizing ODA funds, and (3) minimize foreign exchange risk through macroeconomic stability, growing reserves, more local borrowing, and diversified currencies. The treasurer outlines the country's debt targets and policies to enhance debt profiles and financial market development.

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    Challenges On Debt Management in Developing Countries

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    Asian Development Bank - Event Documents
    92 views18 pages
    The document discusses challenges in debt management for developing countries and the Philippines' strategies to address them. It aims to (1) reduce debt load through high growth, increased revenues, and lower deficits, (2) ensure financing at minimum cost and acceptable risk by improving yield curves, accessing foreign markets strategically, and utilizing ODA funds, and (3) minimize foreign exchange risk through macroeconomic stability, growing reserves, more local borrowing, and diversified currencies. The treasurer outlines the country's debt targets and policies to enhance debt profiles and financial market development.

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    Christine Sanchez

    Original Title

    Challenges on Debt Management in Developing Countries

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    The document discusses challenges in debt management for developing countries and the Philippines' strategies to address them. It aims to (1) reduce debt load through high growth, increased revenues, and lower deficits, (2) ensure financing at minimum cost and acceptable risk by improving yield curves, accessing foreign markets strategically, and utilizing ODA funds, and (3) minimize foreign exchange risk through macroeconomic stability, growing reserves, more local borrowing, and diversified currencies. The treasurer outlines the country's debt targets and policies to enhance debt profiles and financial market development.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF or read online from Scribd
    Download as ppt or pdf
    92 views18 pages

    Challenges On Debt Management in Developing Countries

    Uploaded by

    Asian Development Bank - Event Documents
    The document discusses challenges in debt management for developing countries and the Philippines' strategies to address them. It aims to (1) reduce debt load through high growth, increased revenues, and lower deficits, (2) ensure financing at minimum cost and acceptable risk by improving yield curves, accessing foreign markets strategically, and utilizing ODA funds, and (3) minimize foreign exchange risk through macroeconomic stability, growing reserves, more local borrowing, and diversified currencies. The treasurer outlines the country's debt targets and policies to enhance debt profiles and financial market development.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF or read online from Scribd
    Download as ppt or pdf
    of 18

    CHALLENGES ON DEBT

    MANAGEMENT IN DEVELOPING
    COUNTRIES
    Roberto B. Tan
    Treasurer
    Republic of the Philippines
    March 2011
    DEBT MANAGEMENT
    OBJECTIVES
    1 Reduce Debt Load (Medium-term)

    Ensure government financing is


    2 met at minimum cost within an
    acceptable level of risk

    3 Minimize Foreign Exchange Risk


    1.Reduce Debt Load (Medium-term)

    Quantitative Target – 55% by 2011 to 43%


    by 2016

    How do we achieve this target?


     Sustain high growth path
     Enhanced long-term revenue generation
     Lower budget deficit
    Sustain High Growth Path

    Medium Term GDP Projection


    Increasing Revenue Collection and
    Lowering the Deficit
    25
    21.6
    20.8
    20.0
    18.8 18.9 19.1 19.6
    20 18.5 18.1 18.8
    18.0
    16.3 17.1 18.1
    15.6 17.3
    14.6 14.2 16.4
    15 15.6
    14.8
    14.1
    12.8 12.8

    10

    5 3.9 3.9
    3.2
    2.6
    2.0 2.0 2.0 2.0

    0
    2009 A ctual 2010 2011 2012 2013 2014 2015 2016

    R evenues E xpenditures D eficit Tax E ffort


    2. Ensure government financing is
    met at minimum cost within an
    acceptable level of risk

     Improve the External and Domestic Yield


    Curves
     Strategically accessing foreign debt
    markets
     Maximize utilization of Official
    Development Assistance (ODA) funds
    A more efficient ROP Yield Curve

    200
    8

    200
    9
    201
    0

    201
    1
    Where we are now: Philippine Ratings
    History

    BB+ Non-Investment Grade


    BB BB Speculative
    BB- BB- BB

    Standard and Poor’s currently rates the sovereign 2 steps


    below investment grade at BB, which is a recent update
    from its previous BB- rating.
    Historical Domestic Yield Curves

    200
    0

    200
    5

    201
    0

    2011 (as of March


    2011)
    ROP’s Domestic Debt Profile
    Historical Domestic Average Maturity
    Other reforms moving forward

    Develop market making system

     Unify taxable and tax-exempt markets

    Develop market-making mechanism

    Improve access of retail investors to market


    information and purchase of government securities
    3. Minimize Foreign Exchange Risk

     Controllable macroeconomic measures


     Effective inflation management
     Healthy reserves
     Increase reliance to the domestic market
     Issue local currency denominated global
    bonds
     Diversify international currency
    borrowings
    Effective Inflation Management
    Growing Healthy Reserves
    Increasing reliance to the domestic
    market
    Thank you

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