Westminster Foundation for Democracy would like to invite you to a webinar on the role parliaments play in public debt management.
The COVID-19 pandemic requires governments to respond to the health emergency and address the subsequent economic shock. Mitigating the effects of the pandemic requires financial resources at a time when the economic activities and Gross Domestic Product (GDP) are declining. As governments roll out economic recovery packages and borrow to compensate for the loss of revenues due to the crisis, the public debt in many countries is increasing sharply. The global economic crisis resulting from COVID-19 has pushed some countries closer to the edge and others over the cliff into debt distress.
In some countries, public debt is eating up government financial means and undermining implementation of the Sustainable Development Goals (SDGs). If rising debt costs are not addressed (restructured or reduced), new revenues will not give governments the fiscal space they need to strengthen healthcare systems, pursue women’s economic empowerment programs, ensure free public education through secondary school, or adapt infrastructure to mitigate for climate change, for example.
As parliaments have the power to oversee the budgetary measures adopted to mitigate the effects of the pandemic, they also have an urgent duty to scrutinize the increasing public debt. Often, parliaments and MPs have little information at hand on the public debt situation and strategy to tackle that debt. Parliaments should be provided with detailed information on the structure, sources and long-term estimated effects of debts as well as the conditions attached to credits and loans.
Or, you can also listen to the recording:
- Emil Atanasovski, Director of the WFD Western Balkans programme
- Richard Holden MP, Member of the UK House of Commons Public Accounts Committee
- Geoff Dubrow, Expert in Public Financial Management (Canada)
- Penelope Hawkins, Senior Economic Affairs Officer, United Nations Conference on Trade and Economic Development (UNCTAD)
To support this webinar, WFD has prepared an extensive policy brief on the multifaceted role of parliament in the oversight of public debt and debt management. Drafting of this brief started prior to the COVID-19 outbreak when concerns had already been raised about rising public debt levels in developing countries. The policy brief has been updated as the pandemic unfolded, and more countries ended up in debt distress. The policy brief is aimed at helping parliamentarians and other policy makers gain a better understanding of the substance, relevance and applicability of parliaments’ role in public debt management.
As a result of an increase in COVID-related spending and major shortfalls in public revenues, fiscal deficits and public debt is projected to accumulate throughout the Western Balkans.
This is compounded by the fact that, according to a recent World Bank report, “all Western Balkan countries entered the COVID-19 crisis with more debt than before the 2009 global financial crisis”.
According to a recent report, Montenegro was of particular concern of falling in to debt distress if it continued to receive additional “Belt and Road Initiative” financing from China.
North Macedonia’s debt-to-GDP ratio is projected to reach 76%, the highest in the Western Balkans.
 The World Bank. “The Economic and Social Impact of COVID-19”. Western Balkans Regular Economic Report, No.17. Spring 2020.
 Hurley, John et al. Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective. Centre for Global Development. CGD Policy Paper 121, March 2018
 Alexandru M. Tanase. “The Balkans: External debts in uncertain times”. BNE Intellinews. September 8, 2020.
- When:2pm (CET) / 1pm (UK), 26 November 2020