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By Andrea Shalal
WASHINGTON, April 26 (Reuters) - Debt sustainability
analyses carried out by the World Bank and International
Monetary Fund should reflect the growing share of domestic debt
in many developing countries' overall debt levels, World Bank
President David Malpass said on Wednesday.
Malpass called for urgent measures to jump-start sovereign
debt restructuring efforts for the many countries that are in or
near debt distress, after years of glacial progress under the
Group of 20 Common Framework.
Speaking at a World Bank event entitled "Breaking the
Impasse in Global Debt Restructuring," Malpass said it was
critical to get a better understanding of countries' total debt
levels, including both domestic and external debt.
Pablo Saavedra, the World Bank's vice president for
equitable growth, finance and institutions, noted that domestic
debt now accounted for about 20% of the gross domestic product
of low-income countries, up from 9% a decade ago.
For middle-income countries, that percentage was "north
of 45% of GDP," he said, adding that the current debt analyses
did not give adequate weight to such domestic debt, which was
also often less transparent.
Overall, he said the last decade had seen the fastest
growth of debt in the last 50 years - a concerning development
given lower growth potential and higher inflation.
Carmen Reinhart, the World Bank's previous chief
economist, told the event that there were ongoing concerns about
"hidden debt" and the transparency of external debt levels,
including "severely underreported debt levels" owed to China,
now the world's largest bilateral creditor.
She said there were no publicly available data on net
reserves, and questions about contingent liabilities also
compounded the problem of accurately analyzing debt levels.
"We have a lot of work to do to get this (understanding
of) debt stock right," she said, noting that the share of
privately held debt had also gone up significantly in recent
years.
(Reporting by Andrea Shalal; Editing by John Stonestreet and
Andrea Ricci)
