Debt Management Facility (DMF)

July 10, 2019

The Debt Management Facility (DMF) is a multi-donor trust fund, offering advisory services, training and peer-to-peer learning to more than 80 developing countries around the world to strengthen their debt management capacity, processes, and institutions.

The DMF was launched in 2008 by the World Bank and has been administered jointly with the International Monetary Fund since 2014.

DMF’s objective is to strengthen debt management to reduce debt-related vulnerabilities and improve debt transparency. It seeks to achieve this through capacity-building activities, including design and application of tailored advisory services and technical assistance, applied analytical work, training, and peer-to-peer learning. The DMF facilitates collaboration among providers of technical assistance on debt management and dialogue on debt issues among stakeholders. It also plays a critical role in developing and disseminating information about sound debt management practices, tools, and guidance.

For a decade, the DMF has been supporting capacity building and reform implementation on debt management and has become an internationally recognized global program. With a proven record of excellence in building capacity in debt management and related fields since 2009, the DMF has supported over 350 Technical Assistance (TA) activities in 74 countries and 18 subnational entities.

Significant strides have been made in debt management since 2008 in DMF-eligible countries. Today, more countries prepare and publish debt management strategies; the quality of debt records of government debt has improved; and many countries have improved the organization of their debt management institutions and coordination with fiscal policies through alignment with medium term fiscal frameworks.

Despite progress, important challenges remain. The DMF is uniquely positioned to adapt to emerging debt management challenges and is a critical component of the Bank-Fund Multipronged Approach for Addressing Emerging Debt Vulnerabilities.

The DMF’s ambitious agenda depends on mobilizing adequate financial capacity and flexibility to respond to the urgent needs of our member countries. Our donors provide more than $40 million in contributions to help us move the needle for greater impact. The following eleven donors support the third phase of the DMF: the African Development Bank (AfDB), Austria, the European Commission (EC), France, Germany, Japan, the Netherlands, Norway, Switzerland, the United Kingdom, and the United States

" Countries were gaining access to international capital markets, but without proper training. Often, the result was poor terms. But after working with the DMF, debt sustainability analysis is integrated into macroeconomic planning. Hundreds of officials have been trained in debt management. Many countries have a medium-term debt management strategy. Countries can continue applying lessons learned from the DMF long after active programs have ended. "

Stanislas Nkhata

Director of the Debt Management Programme at the Macroeconomic & Financial Management Institute of Eastern & Southern Africa (MEFMI)