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Domestic Public Debt

The report offers an analysis of the situation and implications of domestic debt in middle-income countries in Latin America, highlighting opportunities, challenges, and recommendations for more transparent and comprehensive public debt management.

Authors: Daniela Berdeja, Rodolfo Bejarano

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Descripción

The report highlights how the distinction between domestic and external debt has become increasingly blurred due to the diversification of financial instruments and the presence of both national and international private creditors. It analyses the main characteristics of domestic debt in Latin America, including the criteria for its definition, the associated risks, and the possible implications of debt restructuring. Additionally, it addresses issues related to sustainability analysis and considerations for the inclusion and treatment of domestic debt within these frameworks.

The cases analysed provide details on the burden of domestic debt and its impact on the national economy in Argentina, the dynamics of debt markets and the policies adopted in Brazil, the indicators of debt profile and management strategies in Colombia, and the composition of public debt and sustainability challenges in Costa Rica.

The report concludes with practical recommendations to improve transparency and the management of domestic debt, emphasising the need for policies that prioritise the sustainability of life over debt.

Published on June 12, 2024