Improving Public Debt Management
In the OIC Member Countries
87
Generally, the authorities plan to improve the use of resources for project financing and
development and pursue a prudent debt policy primarily based on the mobilization of grants
and concessional external financing and the development of the government securities market
with long maturities. To ensure the proper implementation of the strategy, the government
strives to respect the commitments made with regard to the development of the domestic
financial market and the commitments in the framework of the pact of convergence, stability,
growth and solidarity between the member states of the UEMOA.
The public debt management strategy for 2015 aimed at using concessional and semiconcessional external borrowing and gradually extending the maturity of domestic debt
instruments to reduce the portfolio’s exposure to refinancing risk. The average time to
maturity of domestic debt was, however, still short with 3.2 years in 2015 (see Table 43). To
cover refinancing needs, the debt management strategy of 2016 set the objective of using
concessional and semiconcessional external borrowing (target creditors are, among others,
BOAD, AfDB/ADF, IDA, IFAD BADEA, IDB, Kuwait Fund, Saudi Fund, China, China EXIM Bank
and India EXIM Bank) and domestic borrowing with a maturity of three to ten years (MoEF
2015).
Table 4-3: Togo - Cost and Risk Indicators for the Government’s Debt Portfolio (2015)
Type of risk Risk indicator Domestic
debt
External
debt
Total
debt
Solvency Nominal public debt (mio $)
Nominal public debt (% of GDP) 29.3 17.3 46.7
Cost of debt Average interest rate (in %) 4.6 1.6 3.3
Refinancing risk ATM (years) 3.2 9.1 5.7
Debt maturing in 1 year (% of total) 29.2 5.4 18.9
Interest rate risk ATR (years) 3.2 9.1 5.7
Debt refixing in 1 Year (% of total) 29.2 5.4 18.9
Fixed rate debt (% of total) 80.3 100.0 88.8
Exchange rate
risk FX debt (% of total debt) 43.1
ST FX debt (% of reserves) 3.9
Note: ATM = Average Time to Ma urity; ATR = Average Time to Refixing; FX = Foreign exchange; ST = Short-term.
Source: MoEF (2016).
To increase the mobilization of tax resources the performance of the Office of Togolese
Revenue is supposed to improve. The government also strives for signing a program with the
IMF and improving the quality of its policies and institutions to benefit from IDA resources and
donations from other partners.
Borrowing and Related Financial Activities
Operations (incl. Islamic finance)Togo uses both TBills and TBonds for domestic financing. TBills are available with
maturities of seven days, one month, three months, seven months, one year and two years
(AFMI 2016). The nominal value of TBills is set at XOF18 one million (about $1,707) or a
multiple of this amount (AFMI 2016). TBonds have maturities between two and seven years.
Their nominal value is equal to XOF 10,000 (about $17) or a multiple of this amount (AFMI
18 Togo’s currency is CFAFranc BCEAO (Franc de la Communauté Financière d’Afrique, XOF) (BCEAO 2016).