External Debt Statistics : Guide for Compilers and Users

Front Matter

Front Matter

Author(s):
International Monetary Fund
Published Date:
June 2003
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    Bank for International Settlements

    Commonwealth Secretariat

    Eurostat

    International Monetary Fund

    Organisation for Economic Co-operation and Development

    Paris Club Secretariat

    United Nations Conference on Trade and Development

    World Bank

    © 2003 International Monetary Fund

    Cataloging-in-Publication Data

    External debt statistics : guide for compilers and users. — Washington, D.C. : International Monetary Fund, 2003.

    p. cm.

    Includes bibliographical references.

    ISBN 1-58906-060-1

    1. Debts, External — Statistics. 2. Debts, External — Statistical methods.

    I. International Monetary Fund.

    HJ8011.E75 2003

    Price: $60.00

    Please send orders to:

    International Monetary Fund, Publication Services

    700 19th Street, N.W., Washington, D.C. 20431, U.S.A.

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    E-mail: publications@imf.org

    Internet: http://www.imf.org

    Contents

    Foreword

    This volume, External Debt Statistics: Guide for Compilers and Users (the Guide), has been prepared under the joint responsibility of our eight organizations, through the mechanism of the Inter-Agency Task Force on Finance Statistics. The preparation of the Guide, under way since mid-1999, was based on the broad range of experience of our institutions in close consultation with national compilers of external debt and balance of payments statistics.

    International financial crises in the late 1990s underscored the importance of reliable and timely statistics on external debt as a critical element for the early detection of countries’ external vulnerability. Against this background, improving the quality and timeliness of key external debt data and promoting convergence of recording practices have been the focus in the preparation of the Guide. The Guide is a useful source of reference both for national compilers and users of external debt statistics.

    The Guide updates the previous international guidelines on external debt statistics, External Debt: Definition, Statistical Coverage and Methodology, published by four of our organizations in 1988. During the 1990s, new statistical guidelines for national accounts and balance of payments statistics were established, and a substantial growth in financial flows between private sector institutions occurred, including the use of debt instruments and financial derivatives to manage and redistribute risk. The concepts set out in the Guide are harmonized with those of the System of National Accounts 1993 and the fifth edition of the IMF’s Balance of Payments Manual, also published in 1993.

    We recommend that countries adopt the Guide as the basis for compiling and disseminating external debt statistics.

    Malcolm D. Knight

    General Manager

    Bank for International Settlements

    Donald C. McKinnon

    Commonwealth Secretary-General

    The Commonwealth Secretariat

    Yves Franchet

    Director-General

    Statistical Office of the European Communities (Eurostat)

    Horst Köhler

    Managing Director

    International Monetary Fund

    Donald J. Johnston

    Secretary-General

    Organisation for Economic Co-operation and Development

    Delphine d’Amarzit

    Secretary-General

    The Paris Club Secretariat

    Rubens Ricupero

    Secretary-General

    The United Nations Conference on Trade and Development

    James D. Wolfensohn

    President

    The World Bank Group

    Preface

    The need for comprehensive, comparable, and reliable information on external debt to inform policymakers, financial markets, and other users of statistics has long been recognized. This was once again reinforced by the international financial crises in the 1990s. Because they carry obligations to make future payments, external debt liabilities have the potential to create circumstances that render an economy vulnerable to solvency and liquidity problems. Moreover, as experience has shown, external vulnerability can have widespread economic costs, and not just for the initially affected economy. It is clear, therefore, that external debt needs to be measured and monitored. To this end, External Debt Statistics: Guide for Compilers and Users (the Guide) provides guidance on (1) the concepts, definitions, and classifications of external debt data, (2) the sources and techniques for compiling these data, and (3) the analytical uses of these data. The Guide is intended to be of use to both compilers and users of external debt statistics.

    Evolution of This Guide

    The previous international guidance on external debt statistics, External Debt: Definition, Statistical Coverage and Methodology (the “Grey Book”), was published in 1988 by the Bank for International Settlements (BIS), International Monetary Fund (IMF), Organisation for Economic Co-operation and Development (OECD), and World Bank. This publication provided a common definition of external debt. However, since its publication there have been new international statistical guidelines for national accounts and balance of payments statistics—the System of National Accounts 1993 (1993 SNA) and the fifth edition of the IMF’s Balance of Payments Manual (BPM5); a tremendous growth in private sector financial flows, especially to private sector debtors; and, associated with these financial flows, an increased use of instruments such as debt securities and financial derivatives to manage and redistribute risk.

    Against this background, the Guide provides a comprehensive conceptual framework, derived from the 1993 SNA and BPM5, for the measurement of gross external debt of the public and private sectors. It draws on many of the concepts introduced in the Grey Book and is intended to provide clear guidance that can be applied consistently across the different sectors of an economy and across the different debt instruments used for borrowing. Thereafter, the Guide provides a scheme for classifying external debt by instruments and sectors that is developed into a presentation table for the gross external debt position. Data disseminated using this presentation table, and employing the concepts outlined earlier in the Guide, are essential for providing a comprehensive and informed picture of the gross external debt position for the whole economy. For countries in which there is a particular interest in public sector debt, the sector information can be rearranged to give focus to public and publicly guaranteed debt, consistent with the approach used by the World Bank’s Debtor Reporting System. Such a presentation may be of central importance where public sector external debt is dominant, although vigilance in monitoring private sector debt liabilities is necessary because experience has shown that these can grow rapidly.

    Further, from the evidence of the international financial crises of the 1990s, and from the experience of many countries, additional data series may be vital to assist in identifying potential vulnerability to solvency and liquidity problems arising from the gross external debt position. The important need for data on debt-maturity profiles and currency breakdowns has been highlighted in international forums and, together with improving coverage of private sector debt liabilities, has helped to motivate preparation of the Guide. So, the Guide provides additional conceptual guidance, and presentation tables, for data series such as the debt-service schedule (especially relevant for liquidity analysis), the currency composition of debt, and other series known from experience to be of analytical use. The Guide also explains the concept of net external debt—that is, a comparison of the stock of external debt with holdings of external financial assets of similar instrument type—and incorporates financial derivative positions into external debt analysis.

    Drawing on the broad range of experience in the international agencies involved in its production, the Guide provides advice on the compilation of external debt statistics, and the analytical use of such data. This advice is not intended to be comprehensive, but rather provides an overview of the issues. The work of international agencies in the field of external debt is outlined. Because the Guide is primarily intended to be a source of reference for both compilers and users of external debt statistics, certain sections will be more relevant for some audiences than others. For instance, the first section discusses complex conceptual measurement issues and provides detailed advice as a source of reference—this guidance is intended particularly for the compiler. In contrast, the section on the use of external debt data is directed toward both users and compilers. It is hoped that by this approach the Guide will contribute to better external debt statistics and an improved understanding of the complex issues involved in both compiling and analyzing them.

    Acknowledgments

    The production of the Guide has been jointly undertaken by the international agencies that participate in the Inter-Agency Task Force on Finance Statistics (TFFS), in close consultation with national compilers of external debt and balance of payments statistics. The TFFS is one of the interagency task forces formed under the aegis of the United Nations Statistical Commission and the Administrative Committee on Coordination—Sub-Committee on Statistical Activities, and was set up in 1992. It was reconvened in 1998 to coordinate work among the participating agencies to improve the methodological soundness, transparency, timeliness, and availability of data on external debt and international reserve assets. The TFFS was chaired by the IMF, and the work on the Guide involved representatives from the BIS, the Commonwealth Secretariat, the European Central Bank (ECB), Eurostat, the IMF, the OECD, the Paris Club Secretariat, the United Nations Conference on Trade and Development (UNCTAD), and the World Bank. The core participants in the TFFS’s work on the Guide are listed below (affiliations are those in effect at the time of preparation of the Guide). Their expert contributions and comments made possible the production of the Guide.

    ChairMrs. Carol S. Carson (IMF)
    BISMr. Karsten von Kleist
    Commonwealth SecretariatDr. Raj Kumar
    ECBMr. Remigio Echeverría
    Mr. Jean Galand
    Mr. Reimund Mink
    EurostatMr. Eduardo Barredo-Capelot
    IMFMr. Neil Patterson
    Mr. Roger Pownall
    Mr. Robert Heath
    Mr. John Motala
    Mr. Christian Mulder
    Mr. Eduardo Valdivia-Velarde
    OECDMr. Brian Hammond
    Ms. Deborah Guz
    Mrs. Jane Saint-Sernin
    Paris Club SecretariatMr. Jérôme Walter
    UNCTADMr. Enrique Cosio-Pascal
    World BankMs. Punam Chuhan

    The preparation of the Guide was primarily undertaken in the IMF. Mr. Robert Heath (Senior Economist, Balance of Payments and External Debt Division II, Statistics Department) was the primary drafter and also coordinated and edited the contributions of TFFS participants, national agencies, and other experts. The work was supervised by Mr. Neil Patterson (Assistant Director, Balance of Payments and External Debt Division I, Statistics Department) and Mr. Roger Pownall (Chief, Balance of Payments and External Debt Division II, Statistics Department).

    The Guide benefited from the written contributions of other experts in the participating agencies; in particular, Mr. Jean Kertudo (BIS); Mr. Dev Useree, Mr. Andrew Kitili, and Mr. Jose Maurel (all Commonwealth Secretariat); Ms. Silvia von Ledebur (ECB); Mr. Marco Committeri, Mr. Richard Harmsen, Mr. Damoni Kitabire, Mr. René Piché, Mr. Sukhwinder Singh, and Ms. Beatrice Timmermann (all IMF); Mr. Steve Cutts (OECD); Mr. Pal Borresen (UNCTAD); and Mr. Paul Beckerman, Mr. Misha V. Belkindas, Mr. Anthony Richard Howe Bottrill, Ms. Hana Polackova Brixi, Ms. Nevin Fahmy, Mr. Sundarshan Gooptu, Mr. Frederick Henry Jensen, Ms. Marie-Helene Le Manchec, Mr. Deepak K. Mishra, and Ms. Gloria R. Moreno (all World Bank). Mr. Eduardo Valdivia-Velarde (Senior Economist, Balance of Payments and External Debt Division II, Statistics Department, IMF) was responsible for overseeing the preparation of the Guide in its final stages through publication, coordinating final comments, and refining the text. Ms. Elva Harris and Ms. Marlene Pollard (Statistics Department, IMF) provided administrative support in preparing the manuscript, and Mr. James McEuen (External Relations Department, IMF) copyedited the final manuscript and coordinated publication of the Guide.

    Also, the TFFS acknowledges, with gratitude, the contributions of many compilers and users of external debt statistics in member countries. Responses to requests for comments on the draft Guide posted on the Internet in March 2001 came from many official agencies and others in countries across the world, and the text benefited enormously from these views. In addition, the following agencies, listed alphabetically by country, provided the case studies of country experience in various aspects of the compilation and use of external debt data. These case studies are set out in Chapter 14.

    AustraliaAustralian Bureau of Statistics
    AustriaOesterreichische Nationalbank
    CanadaStatistics Canada
    ChileCentral Bank of Chile
    IndiaMinistry of Finance and Reserve Bank of India
    IsraelBank of Israel
    MexicoDepartment of Public Credit
    New ZealandStatistics New Zealand
    PhilippinesBangko Sentral ng Pilipinas
    TurkeyCentral Bank of Turkey
    UgandaBank of Uganda

    Carol S. Carson

    Director

    Statistics Department

    International Monetary Fund

    Abbreviations and Acronyms

    ADB

    Asian Development Bank

    AfDB

    African Development Bank

    BIS

    Bank for International Settlements

    BOP

    Balance of payments

    BOPSY

    Balance of Payments Statistics Yearbook (IMF)

    BPM5

    Balance of Payments Manual, fifth edition (IMF)

    CBDMS

    Computer-based debt-management system

    CIRR

    Commercial Interest Reference Rate (OECD)

    CMFB

    Committee on Monetary, Financial and Balance of Payments Statistics (EU)

    CPIS

    Coordinated Portfolio Investment Survey (IMF)

    CRS

    Creditor Reporting System (OECD)

    CS-DRMS

    Commonwealth Secretariat’s Debt Recording and Management System

    DAC

    Development Assistance Committee (OECD)

    DMFAS

    Debt Management and Financial Analysis System (UNCTAD)

    DOD

    Disbursed and outstanding debt

    DRS

    Debtor Reporting System (World Bank)

    DSM Plus

    Debt Sustainability Module Plus (World Bank)

    ECB

    European Central Bank

    ESA95

    European System of Accounts, ESA 1995

    EU

    European Union

    GDDS

    General Data Dissemination System

    GDP

    Gross domestic product

    GNF

    Global note facility

    Grey Book

    External Debt: Definition, Statistical Coverage and Methodology (Bank for International Settlements, International Monetary Fund, Organisation for Economic Co-operation and Development, and World Bank, 1988)

    HIPC Initiative

    Initiative for heavily indebted poor countries

    IADB

    Inter-American Development Bank

    IBRD

    International Bank for Reconstruction and Development

    IBS

    International Banking Statistics (BIS)

    IDA

    International Development Association

    IFMS

    Integrated Financial Management System

    IFS

    International Financial Statistics (IMF)

    IIP

    International investment position

    IMF

    International Monetary Fund

    ISIN

    International security identification number

    LIBOR

    London interbank offered rate

    MEFMI

    Macroeconomic and Financial Management Institute for Eastern and Southern Africa

    MOF

    Multiple options facility

    NIF

    Note issuance facility

    NNA

    National numbering agency

    NPISH

    Nonprofit institutions serving households

    ODA

    Official development assistance

    OECD

    Organisation for Economic Co-operation and Development

    OTC

    Over-the-counter [markets]

    Repo

    Repurchase agreement

    RUF

    Revolving underwriting facility

    SDDS

    Special Data Dissemination Standard

    SDR

    Special drawing rights (IMF)

    1993 SNA

    System of National Accounts 1993

    SPE

    Special purpose entity

    TFFS

    Inter-Agency Task Force on Finance Statistics

    UNCTAD

    United Nations Conference on Trade and Development

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