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BRIEF

Debt Sustainability Analysis (DSA)

December 11, 2018
The Debt Sustainability Analysis is a tool that is used as part of a framework developed by the World Bank and the International Monetary Fund to help guide countries and donors in mobilizing critical financing for low-income countries, while reducing the chances of an excessive build-up of debt.

The Debt Sustainability Framework (DSF), developed in 2005, is designed to guide the borrowing decisions of low-income countries in a way that matches their financing needs with their current and prospective ability to repay debt. It also allows creditors to tailor their financing terms in anticipation of future risks.

A key part of the framework is Debt Sustainability Analysis (DSA), a structured examination of a country's debt that debt experts from the IMF and World Bank conduct regularly in low-income and middle-income countries. Some of the focal points of these analyses are:

  • an analysis of a country’s projected debt burden over the next 20 years and its vulnerability to external and policy shocks;
  • an assessment of the risk of external debt distress in that time, based on indicative debt burden thresholds that depend on the quality of the country’s policies and institutions; and
  • recommendations for a borrowing (and lending) strategy that limits the risk of debt distress.

DEBT SUSTAINABILITY ANALYSIS

Country Risk of External Debt Distress Risk of Public Debt Distress Most Recent Debt Sustainability Analysis
Afghanistan High High 11/21/2017
Bangladesh Low   10/1/2018
Benin Moderate Moderate  12/28/2018
Bhutan Moderate Moderate 12/18/2018
Burkina Faso Moderate Moderate 2/7/2019
Cambodia Low Low 2/5/2019
Cameroon High High 3/15/2019
Central African Republic High   6/26/2018
Chad High High 7/13/2018
Côte d'Ivoire Moderate Moderate 2/15/2019
Dominica High High 10/1/2018
Ethiopia High High 12/14/2018
The Gambia In distress In distress 10/1/2018
Grenada In distress   7/5/2018
Guinea Moderate Moderate 2/11/2019
Honduras Moderate Moderate 10/1/2018
Kiribati High High 2/12/2019
Liberia Moderate   10/1/2018
Madagascar Moderate   6/26/2018
Malawi Moderate High 12/14/2018
Marshall Islands High   8/10/2018
Mauritania High High 12/28/2018
Niger Moderate Moderate 2/15/2019
Papua New Guinea Moderate Moderate 12/20/2018
São Tomé and Príncipe In distress   9/14/2018
Sierra Leone High High 2/1/2019
Solomon Islands Moderate Moderate  12/11/2018
Togo Moderate   10/1/2018
Tuvalu High High  10/1/2018
RESOURCES
PUBLICATIONS
  • Review of the debt sustainability framework for low income countries : proposed reforms (October 2017) [Document]
  • Revisiting the Debt Sustainability Framework for Low-Income Countries (January 2012) - [Document]
  • A Review of Some Aspects of the Low-Income Country Debt Sustainability Framework (August 2009) - [Document]
  • Applying the Debt Sustainability Framework for Low-Income Countries Post Debt Relief (November 2006) - [Document]
  • Review of Low-Income Country Debt Sustainability Framework and Implications of the MDRI (March 2006) - [Document]
  • When Is External Debt Sustainable? (March 2006) - [Document]
  • Operational Framework for Debt Sustainability Assessments in Low-Income Countries: Further Considerations (March 2005) - [Document]
  • Public Summary: Debt Sustainability in Low-Income Countries: Further Considerations on an Operational Framework and Policy Implications (November 2004) - [Document]
  • Debt Sustainability in Low-Income Countries: Further Considerations on an Operational Framework and Policy Implications (September 2004) - [Document]
  • Debt Sustainability in Low-Income Countries: Proposal for an Operational Framework and Policy Implications (February 2004) - [Document]
Debt Sustainability Resources
RELATED
Interactive Guide on Debt Sustainability Framework for Low-Income Countries

LIC DSF Excel Template