Back Matter

References

  • Beaugrand, Philippe, Bolieau Loko, and Montfort Mlachila, 2002, “The Choice Between External and Domestic Debt in Financing Budget Deficits: The Case of Central and West African Countries,” IMF Working Paper 02/79 (Washington: International Monetary Fund).

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  • Easterly, Stanley and William Easterly, 1990, “The Economics Of the Government Budget Constraint,” The World Bank Research Observer, Vol. 5, No. 2, pp. 127-42.

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  • Gelbard, Enrique and Sergio Leite, 1999, “Measuring Financial Development in Sub-Saharan Africa,” IMF Working Paper 99/105 (Washington, International Monetary Fund).

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  • Mehran, Hassanali and others, 1998, Financial Sector Development in Sub-Saharan African Countries, IMF Occasional Paper No. 169 (Washington: International Monetary Fund).

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  • World Bank and International Monetary Fund, 2001, Developing Government Bond Markets, a Handbook (Washington: World Bank).

1

I am indebted to Scott Rogers for his continuous advice and support. In addition, I would like to thank seminar participants at the IMF’s African Department for discussion and comments and desk economists for their generous data provisions. The usual disclaimer applies.

2

Most countries do not have significant stocks of direct advances as governments as governments generally clear these at the end of the year through issuance of treasury bills or transfers from other government accounts. However, a few number of the countries in the database have accumulated significant stocks of direct liabilities to the banking system.

3

Mozambique and Botswana have fairly developed markets for central bank notes.

4

A good measure of these shortcomings is the amount of nonperforming loans (NPL). Mehran and others (1998) found that the ratio of NPL to total loans averaged 16 percent in 16 non-CFA countries. The ratio was significantly higher for HIPCs than in non-HIPCs with almost a quarter of total loans being recorded as NPLs in the former group.

5

A more common approach is to look at the uncovered interest rate parity. However, using foreign market interest rates for African countries may overstate the cost, since most of their borrowing is on highly concessional terms with interest rates well below market rates. The implicit interest rate calculates the average interest rate, which takes into account the (expost) exchange rate depreciation.

Domestic Debt Markets in Sub-Saharan Africa
Author: Mr. Jakob E Christensen