DEVELOPMENT OF A MEDIUM-TERM STRATEGY FOR THE RA PUBLIC DEBT MANAGEMENT

Abstract

The process of developing a debt management strategy includes defining debt management objectives, examining the costs and risks of different strategies, and having a strong governance model in place, including ensuring that debt managers are competent to implement the strategy effectively. In this article, the analysis of the RA government's debt management strategies was carried out using the medium-term debt strategy analytical tool (MTDS) developed by the World Bank and the IMF. To evaluate the government's debt management strategies, forecasts of macroeconomic indicators were carried out. By studying the indicators of the debt of the RA government in the previous periods, 3 different debt management strategies were developed. In the first two cases, the specific weight of the debt in AMD in the debt portfolio is increased, and in the third case, new credit funds are attracted in such a way that the internal sources for financing the budget deficit do not exceed the share of domestic debt in the debt portfolio in 2022. Using the MTDS model, the risks of the debt portfolio and debt burden were assessed for each of the strategies. According to the obtained results, the selected strategies are sustainable to exchange rate and interest rate shocks. Taking into account the obtained results and the goals of the RA government's debt management, the first strategy is a more preferable option in the case of a comparative analysis of the results/risks.