Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia

The COVID-19 crisis, which has sent economies in South Asia and around the world into a deep recession, has highlighted South Asia’s rising debt levels and sizable hidden liabilities. State-owned enterprises, state-owned commercial banks, and public-private partnerships have been at the center of th...

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Main Author:	Melecky, Martin
Format:	Book
Published:	Washington, DC: World Bank 2021
Subjects:	CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE PUBLIC SECTOR DEBT STATE-OWNED ENTERPRISES PUBLIC-PRIVATE PARTNERSHIP TRANSPARENCY ACCOUNTABILITY PUBLIC EXPENDITURE DEBT SUSTAINABILITY DEBT SERVICE BURDEN GOVERNANCE PUBLIC SECTOR REFORM PUBLIC AND PUBLICLY GUARANTEED DEBT PUBLIC GUARANTEE
Online Access:	https://documents.worldbank.org/en/publication/documents-reports/documentdetail/989391624909481034/hidden-debt-solutions-to-avert-the-next-financial-crisis-in-south-asia?cid=WBW_AL_whatsnew_EN_EXT http://hdl.handle.net/10986/35595

id	okr-10986-35595
recordtype	oai_dc
spelling	okr-10986-355952021-11-09T15:23:59Z Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia Melecky, Martin CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE PUBLIC SECTOR DEBT STATE-OWNED ENTERPRISES PUBLIC-PRIVATE PARTNERSHIP TRANSPARENCY ACCOUNTABILITY PUBLIC EXPENDITURE DEBT SUSTAINABILITY DEBT SERVICE BURDEN GOVERNANCE PUBLIC SECTOR REFORM PUBLIC AND PUBLICLY GUARANTEED DEBT PUBLIC GUARANTEE The COVID-19 crisis, which has sent economies in South Asia and around the world into a deep recession, has highlighted South Asia’s rising debt levels and sizable hidden liabilities. State-owned enterprises, state-owned commercial banks, and public-private partnerships have been at the center of the rising debt wave and the latest pandemic response. Historically, South Asia has relied on these direct public interventions more than other regions. The interventions have helped governments tackle key development challenges and rapidly deliver relief measures during crises. However, because of their inefficiencies and weak governance, the interventions are also a significant source of public indebtedness and macrofinancial risks. Hidden Debt examines the trade-off between tackling development challenges through direct state presence in the market and avoiding unsustainable debt due to economic inefficiencies of such off–balance sheet operations, which greatly leverage public capital. The study recommends a reform agenda based on the four interrelated principles of purpose, incentives, transparency, and accountability (PITA). The reforms can mitigate the risks that off–balance sheet operations will become the source of the next financial crisis in South Asia. 2021-05-19T14:50:46Z 2021-05-19T14:50:46Z 2021-06-29 Book https://documents.worldbank.org/en/publication/documents-reports/documentdetail/989391624909481034/hidden-debt-solutions-to-avert-the-next-financial-crisis-in-south-asia?cid=WBW_AL_whatsnew_EN_EXT 978-1-4648-1667-3 http://hdl.handle.net/10986/35595 South Asia Development Matters; CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank Washington, DC: World Bank Publications & Research Publications & Research :: Publication South Asia South Asia
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
topic	CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE PUBLIC SECTOR DEBT STATE-OWNED ENTERPRISES PUBLIC-PRIVATE PARTNERSHIP TRANSPARENCY ACCOUNTABILITY PUBLIC EXPENDITURE DEBT SUSTAINABILITY DEBT SERVICE BURDEN GOVERNANCE PUBLIC SECTOR REFORM PUBLIC AND PUBLICLY GUARANTEED DEBT PUBLIC GUARANTEE
spellingShingle	CORONAVIRUS COVID-19 PANDEMIC IMPACT PANDEMIC RESPONSE PUBLIC SECTOR DEBT STATE-OWNED ENTERPRISES PUBLIC-PRIVATE PARTNERSHIP TRANSPARENCY ACCOUNTABILITY PUBLIC EXPENDITURE DEBT SUSTAINABILITY DEBT SERVICE BURDEN GOVERNANCE PUBLIC SECTOR REFORM PUBLIC AND PUBLICLY GUARANTEED DEBT PUBLIC GUARANTEE Melecky, Martin Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
geographic_facet	South Asia South Asia
relation	South Asia Development Matters;
description	The COVID-19 crisis, which has sent economies in South Asia and around the world into a deep recession, has highlighted South Asia’s rising debt levels and sizable hidden liabilities. State-owned enterprises, state-owned commercial banks, and public-private partnerships have been at the center of the rising debt wave and the latest pandemic response. Historically, South Asia has relied on these direct public interventions more than other regions. The interventions have helped governments tackle key development challenges and rapidly deliver relief measures during crises. However, because of their inefficiencies and weak governance, the interventions are also a significant source of public indebtedness and macrofinancial risks. Hidden Debt examines the trade-off between tackling development challenges through direct state presence in the market and avoiding unsustainable debt due to economic inefficiencies of such off–balance sheet operations, which greatly leverage public capital. The study recommends a reform agenda based on the four interrelated principles of purpose, incentives, transparency, and accountability (PITA). The reforms can mitigate the risks that off–balance sheet operations will become the source of the next financial crisis in South Asia.
format	Book
author	Melecky, Martin
author_facet	Melecky, Martin
author_sort	Melecky, Martin
title	Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
title_short	Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
title_full	Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
title_fullStr	Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
title_full_unstemmed	Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia
title_sort	hidden debt : solutions to avert the next financial crisis in south asia
publisher	Washington, DC: World Bank
publishDate	2021
url	https://documents.worldbank.org/en/publication/documents-reports/documentdetail/989391624909481034/hidden-debt-solutions-to-avert-the-next-financial-crisis-in-south-asia?cid=WBW_AL_whatsnew_EN_EXT http://hdl.handle.net/10986/35595
_version_	1764483310932721664

Hidden Debt : Solutions to Avert the Next Financial Crisis in South Asia

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