Speech

Keynote Address at 17th IMF Public Debt Management Forum

June 19, 2019

I. Introduction

Good morning, ladies and gentlemen. It’s a great pleasure to welcome all of you here today for this important conference.

The IMF Public Debt Management Forum aims to bring together public debt managers, other government and international agencies, and private sector executives to exchange views on current challenges and opportunities in the sovereign debt capital markets.

For this, the 17^th such forum, we are pleased and honored to be co-hosting the event with the Japanese Ministry of Finance. We are most grateful for their hospitality, and for their efficiency and drive in organizing the event. Our experience is that having such an event co-hosted helps ensure that participants gain insights from a variety of perspectives, on issues of relevance to many countries.

This forum is an occasion for us to reflect on how we can anticipate possible strains in debt markets, and how we can adapt to longer-term trends. Our aim, as always, is ensuring the smooth funding of governments; maintaining the availability of attractive savings vehicles; and promoting the efficient functioning of financial markets. We will discuss elements of the economic and market outlook that are relevant to debt markets and debt management; look at some of the more structural changes that are occurring, in such areas as regulation and technology; and explore how the public and private sectors can foster beneficial innovation. The individual sessions will go into issues in some depth. In particular the first session is focused on near term and conjunctural conditions. Here I’d like to offer some thoughts on longer term and structural issues.

II. Debt Burdens

Sound debt management and the efficient functioning of sovereign debt capital markets is as important as ever, not least because debt levels are high and are likely to remain high.

Debt outstanding is very large in many Advanced Economies (AEs) and some Emerging Markets (EMs). The global financial crisis led to a sharp increase in government debt as the public sector took over private debt and fiscal policy was switched to an expansive mode. Some countries have managed to reverse the increase, but — as these charts illustrate — the upward shift is found across much of the OECD and major emerging market countries. The ratio of general government debt to GDP has gone up markedly even in countries such as China, Australia and Vietnam which have elevated growth records. So there is plenty for debt managers to do.

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