Republic of Madagascar - Joint World Bank-IMF Debt Sustainability Analysis
Madagascar is assessed at low risk of external debt distress. This marks a change from moderate risk in the June 2018 DSA, despite a broader definition of external debt, and reflects an upgrade in Madagascar’s debt carrying capacity rather than a c...
| Main Authors: | , |
|---|---|
| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2019
|
| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/900641570834007200/Madagascar-Joint-World-Bank-IMF-Debt-Sustainability-Analysis-August-2019 http://hdl.handle.net/10986/32569 |
| Summary: | Madagascar is assessed at low risk of
external debt distress. This marks a change from moderate
risk in the June 2018 DSA, despite a broader definition of
external debt, and reflects an upgrade in Madagascar’s debt
carrying capacity rather than a change in the debt path.
Under the baseline, external public and publicly guaranteed
(PPG) debt is well below applicable thresholds. Stress tests
do not breach the threshold applicable to countries with
medium debt-carrying capacity. Total (external plus
domestic) PPG debt is below the benchmark under the
baseline, but growth shocks drive the present value of the
ratio of debt to GDP above the benchmark. Shocks could also
introduce liquidity problems, as the debt-service to revenue
ratio could exceed 100 percent over the long term. The
overall rating, of moderate debt distress, remains
consistent with the 2018 DSA. These assessments continue to
be supportive of Madagascar’s current plans to scale up its
borrowing to meet its investment needs, though other factors
are also critical. |
|---|