Internal and External Debt Management Program
INTRODUCTION
External debt possessed a negative impact on economic growth while domestic debt has impacted positively on economic growth (GDP). A good performance of an economy in terms of per capita growth may therefore be attributed to the level of domestic debt and not on the level of external debt in the country; therefore external debt is seen as inimical to the economic progress of a country. If domestic debts is properly managed it can lead to high growth level. A major policy implication of this result is that concerted effort be made by policy makers to manage the debt effectively by channeling them to productive activities (real sector) so as to increase the level of output, hence achieving the desire level of growth. Another policy implication is that most developing countries contract debt for selfish reasons rather than for the promotion of economic growth through investment in capital formation and other social overhead capital. Thus, the course also recommends that government should rely more on domestic debt in stimulating growth rather than external debt. Government should formulate policies aimed at encouraging domestic savings vis-à-vis domestic investment. The need for borrowing is due to gap between domestic savings and investment, therefore, bridging the gap can be a likely solution to a country’s debt accumulation. For debt to promote growth and other highly indebted countries fiscal discipline and high sense of responsibility in handling public funds should be the Watchword of the developing countries’ leaders. Debt can only be reduced to the barest minimum by increasing output level (GDP).
Course Objectives
- State in simple terms the meaning of public debt;
- Describe the aspects of domestic and external debt;
- Explain the basic and advanced concepts in public debt management; and
- Determine the implications of contingent liability and risk management.
Target Group
Mid-level officials from debt management offices, ministries of finance and central banks working on debt issues, Ministry of finance and central bank technical and management-level, debt managers and practitioners of finance from LDCs, developing and developed countries. all professionals that are interested in public debt management issues, because it provides an overall review of basic principles and knowledge of public debt management for the auditors to acquire the necessary knowledge to undertake public debt audits.