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Burkina Faso - Joint World Bank-IMF Debt Sustainability Analysis (English)

Burkina Faso remains at moderate risk of external debt distress. The rating is unchanged from the April 2020 Debt Sustainability Analysis (DSA). The macroframework underlying this DSA accounts for Burkina Faso’s recent gross domestic product (GDP) rebasing and incorporates the impact of the Covid19 pandemic and the deteriorating security situation. The current debt-carrying capacity is consistent with a classification of ’medium’. The risk of overall and external debt distress in Burkina Faso remains moderate, with substantial space to absorb shocks. All external debt indicators remain below the relevant indicative thresholds under the baseline scenario. Under a standard stress test of a shock to exports, two of the thresholds for l public and publicly-guaranteed (PPG) external debt—debt service-to-exports and debt service-to-revenue ratios are breached. Overall public debt breaches the relevant benchmark under one scenario. Burkina Faso would need to: (i) maintain a sound macro-fiscal framework in the midst of the pandemic shock; (ii) implement structural reforms to diversify its export base; (iii) exercise control over government guarantees and contingent liabilities; and (iv) limit non-concessional borrowing and strengthen the implementation of its medium-term debt strategy to contain its debt service and gross financing needs in order to prevent a deterioration of its debt sustainability outlook.

Details

  • Document Date

    2020/11/01

  • Document Type

    Board Report

  • Report Number

    154943

  • Volume No

    1

  • Total Volume(s)

    1

  • Country

    World,

  • Region

    The World Region,

  • Disclosure Date

    2020/12/08

  • Disclosure Status

    Disclosed

  • Doc Name

    Burkina Faso - Joint World Bank-IMF Debt Sustainability Analysis

  • Keywords

    real gdp; debt service; contingent liability; contingent liabilities; public debt; baseline scenario; primary balance; domestic debt; Public and Publicly Guaranteed; public sector debt; commodity price; state-owned enterprise; total public debt; debt relief; fiscal deficit; real exchange rate depreciation; real interest rate; nominal interest rate; debt-creating flow; financing need; natural disaster; market financing; concessional financing; risk of debt; average interest rate; current account deficit; export of goods; primary deficit; export ratio; dollar term; domestic financing; risk and vulnerability; exchange rate change; external debt sustainability; diversified export base; debt sustainability analysis; external debt indicator; projection period; external financing; export shock; total external debt; Effective interest rate; macroeconomic and fiscal; exchange rate projections; control of expenditures; debt service relief; public sector borrowing; national electricity company; public debt stock; change in arrears; private sector debt; national oil company; composition of debt; extra budgetary fund; social security fund; commodity price shock; total debt stock; private external debt; fiscal adjustment; fiscal consolidation; regional market; grace period; grant element

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Citation

Burkina Faso - Joint World Bank-IMF Debt Sustainability Analysis (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/548881607656399530/Burkina-Faso-Joint-World-Bank-IMF-Debt-Sustainability-Analysis