IMF projects dip in public debt

The International Monetary Fund (IMF) projected the country’s net public debt to dip below 40 per cent of the Gross Domestic Product by the end of 2014 to 2015 financial year.

IMF Resident Representative Ragnar Gudmundsson said the prudent fiscal and monetary policies would be key in achieving this goal.

“The IMF thinks that based on current trends and efforts on fiscal consolidation, net public debt to GDP ratio will be below 40 per cent by the end of the 2014/2015 financial year,” Gudmundsson said on the sidelines of the launch of 2012 IMF Africa Economic Outlook report in Nairobi. According to the IMF, total net public debt stands at 46 per cent of GDP while the Treasury’s target stands at 45 per cent of GDP.

“Due to macro-economic stability and efficient management of the economy, the level of public indebtedness is set to reach sustainable levels,” Gudmundssone said. The report said economies in Sub-Saharan Africa registered growth of five per cent last year despite difficult conditions.

The report said while most of the region’s banking systems proved to be resilient to global financial stress, steady expansion of pan-African banking groups could in some instances outpaced supervisory capacity.       
—Xihnua