Speech

G20 DGI Regional Thematic Workshop on Government Finance Statistics and Public Sector Debt Statistics

March 2, 2020

As prepared for delivery

Good morning!

Thank you, Gabriel, for the kind introduction. I am pleased to welcome you to this joint World Bank and IMF G-20 Data Gaps Initiative Regional Thematic Workshop on Government Finance Statistics and Public Sector Debt Statistics —the GFS and PSDS. On behalf of the IMF, I would also like to express my gratitude to the Saudi authorities for hosting this important event.

This Workshop is the second—and final—on this topic during Phase 2 of the Data Gaps Initiative. And, as you know, the objective is for all G-20 countries to meet their commitments by the end of Phase 2 in June of 2021.

I am also pleased to see that two non–G-20 countries from the region are participating— Egypt and the United Arab Emirates.

Much of the discussion over the next two days will focus on your efforts to develop fiscal statistics that include both operations as well as balance sheet information.

Government operations data provides important information about government policies while balance sheet analysis enriches the policy debate by focusing on the full extent of public wealth. Public assets are a valuable resource. And how governments use and report on them matters. But not just for financial reasons. It also matters for improving service delivery and preventing the misuse of resources that can result from a lack of transparency.

Over the next two days, we will recognize the progress and accomplishments that your countries have made up to now. And we also hope to help you identify—within your specific national contexts—a way forward through the end of this initiative in 2021.

We trust that the next two days will result in very productive discussions, to be followed by concrete actions taken by you and your colleagues back home. These actions can then be highlighted at the Global Conference scheduled to take place about four months from now in June. We will also look for ways to help develop capacity in the compilation of GFS and PSDS. This should in turn help your countries to compile and disseminate these data in a manner that is both high-quality and high-frequency—and by “high-frequency” I mean quarterly. In doing so, you will be meeting international standards—namely theGovernment Finance Statistics Manual 2014 and the Public Sector Debt Statistics Guide for Compilers and Users 2011.

The GFS framework, which the World Bank’s PSDS initiative builds on, provides the tools needed to analyze the resilience of public finances. These tools allow governments to examine both sides of the balance sheet to identify imbalances or mismatches and use fiscal stress tests to gauge the strength of public finances. By identifying risks in the balance sheet, governments can act to manage or reduce those risks early on, rather than dealing with the consequences after problems occur.

As such, balance sheets provide the most comprehensive picture of public wealth. They aim to bring together all the accumulated assets and liabilities that the government controls—including natural resources and pension liabilities. In this way, they account for the entirety of what the state owns and owes. And they offer a broader fiscal picture beyond debt and deficits.

But most governments do not provide the transparency needed to form a complete and accurate picture, thereby avoiding the additional scrutiny it brings. Yet only after governments begin to understand the size and nature of public assets, can they then begin to manage them more effectively.

Of course, for the IMF, the ultimate purpose for fiscal and debt statistics adhering to international standards is to provide policymakers with comprehensive, and accurate, data that are cross-country comparable.

But beyond high-quality and high-frequency GFS and PSDS that are comparable at the international level, there are also important domestic requirements for good GFS and PSDS. For example, formulating a holistic vision for government finance requires high-quality GFS and PSDS at the national and subnational levels to perform key functions, which include:

• Forecasting the amount of revenue that can be generated at the national and subnational levels, and determining how revenue should be shared; and
• Establishing the level of debt that is not only sustainable, but that fosters higher levels of inclusive growth.

As representatives of the world’s G-20 nations, your presence here attests to what your governments have committed to fulfilling, but are perhaps not currently fully meeting, in terms of certain statistical requirements, or “targets,” under the Data Gaps Initiative. One example is to compile and disseminate quarterly GFS and PSDS for the general government sector. I hope over the next two days we can make progress toward fulfilling these requirements.

Indeed, we all see that greater international cooperation is needed to address difficult multilateral issues, including corporate taxation, climate change, corruption, and, more generally, to achieve the 2030 Sustainable Development Goals. The actions needed to meet these challenges will be founded upon the availability of data that support good (and timely) fiscal analysis. And this is a truly vital part of the reason you are here today.

Moreover, your work sets the bar for many other countries around the world. I am happy to say that both Egypt and the United Arab Emirates are among the approximately 130 countries reporting annual GFS to the IMF Statistics Department. About 80 of these countries are also reporting financial balance sheet information, which means debt data too.

Of course, not all of them are currently providing data on the consolidated general government and many key economies do not currently report quarterly data as prescribed under the Data Gaps Initiative recommendations. But I think we can all be certain that when countries see what their peers are achieving in terms of improving macroeconomic statistics, they are often encouraged to undertake what may have previously seemed to be a daunting challenge. This means that your work is extremely important!

So let me stop here and take a final opportunity to wish each of you a productive Workshop. It will go by quickly. And you should ensure you take with you all the information you need to go back and help your countries move forward on meeting the Data Gaps Initiative targets relating to fiscal data.

Thank you!