Review of The Debt Sustainability Framework For Market Access Countries

International Monetary Fund

No 2021/003, IMF Policy Papers from International Monetary Fund

Abstract: A careful review has revealed significant scope to modernize and better align the MAC DSA with its objectives and the IMF’s lending framework. This note proposes replacing the current framework with a new methodology based on risk assessments at three different horizons. Extensive testing has shown that the proposed framework has much better predictive accuracy than the current one. In addition to predicting sovereign stress, the framework can be used to derive statements about debt stabilization under current policies and about debt sustainability.

Keywords: IMF team; resource requirement; definition of stress event; sustainability assessment; I. backtesting result; Debt sustainability analysis; Debt sustainability; Fiscal stance; Debt refinancing; Global (search for similar items in EconPapers)
Pages: 124
Date: 2021-02-03
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