Guinea : Joint Bank-Fund Debt Sustainability Analysis, 2018 Update
The results of the update of the Debt Sustainability Analysis (DSA) show that Guinea continues to be at a moderate risk of external debt distress. All external debt burden indicators under the baseline scenario lie below their policy-dependent thre...
| Main Authors: | , |
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| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
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| Online Access: | http://documents.worldbank.org/curated/en/698481539631229678/Guinea-Joint-Bank-Fund-Debt-Sustainability-Analysis-2018-Update http://hdl.handle.net/10986/30907 |
| Summary: | The results of the update of the Debt
Sustainability Analysis (DSA) show that Guinea continues to
be at a moderate risk of external debt distress. All
external debt burden indicators under the baseline scenario
lie below their policy-dependent thresholds and debt
dynamics have improved compared to the 2017 DSA, given
higher-than-anticipated growth during 2016–17. Stress tests
suggest that debt vulnerabilities owing to accumulation of
external debt related to financing of infrastructure
projects will increase if adverse shocks materialize, though
remaining more contained than in the 2017 DSA. Under most
extreme stress tests, all solvency and liquidity indicators
except one breach their thresholds and for prolonged
periods. The inclusion of domestic debt does not
significantly change the conclusion of the external DSA. A
prudent external borrowing strategy aimed at maximizing the
concessionality of new debt, limiting non-concessional loans
in line with programmed amounts, and strengthening debt
management will be key to preserving medium-term debt sustainability. |
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