Improving Public Debt Management
In the OIC Member Countries
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Debt reportingMonitoring of debt developments, internal reporting of monitoring results and providing debt
statistics are main tasks of the Debt Office. Monitoring and related reporting is carried out
according to IMF standards. The Ministry of Economy provides “consolidated” reports of total
public debt which also include quasidebt developments and debt related operations of the
National Bank. These monitoring reports are published quarterly.
Debt management strategy (incl. risk management)The general purpose of state borrowing is to fund the budget deficit, to promote the
development of the domestic debt market and to refinance government debt (Republic of
Kazakhstan 2008, Article 205).
Debt management includes the annual assessment and forecast of state and state guaranteed
borrowing, the identification of limits on government debt on the provision of state
guarantees, and the categorization of debt amounts into forms and conditions (Republic of
Kazakhstan 2008, Article 203). Debt management also includes measures to optimize and
diversify the debt structure and debt service (use of various derivative financial instruments
such as options, swaps, forwards, futures and other transactions), and debt refinancing
strategies and risk management (Republic of Kazakhstan 2008, Article 203).
Although there is no published debt management strategy following international guidelines,
the Strategic Plan of the MoF addresses some areas of debt management (MoF 2011). For the
period 20112015, the key means to reduce debt were the monitoring of government debt and
the “full and timely implementation of obligations to creditors on payment of remuneration
(interests) on governmental loans” (MoF 2011, p. 7). In order to secure the accountability,
transparency and efficiency of the involved institutions, the introduction of a risk control
system to monitor the activity of administrators through an external supervision was
established in 2012/2013.
The general strategy of the MoF and the medium fiscal plans serve as general guidelines to
public expenditure and debt management. The MoF further publishes detailed descriptions of
the government securities, coupon dates and auction rules on its website (MoF 2016).
Borrowing and Related Financial Activities
Operations (incl. Islamic finance)The government of Kazakhstan is allowed to use both loans and government securities for the
purpose of borrowing (Republic of Kazakhstan 2008, Article 200). Government securities
might have short(up to 1 year), medium(1 to 5 years) and longterm (over 5 years)
maturities and may be issued in certificated and noncertificated forms. They can be issued at
nominal or present value with fixed and nonfixed (floating) rates of remuneration (Republic
of Kazakhstan 2008, Article 200).
Kazakhstan uses various debt instruments (see Figure 431). The borrowing costs depend
primarily on the refinancing rate set by the NBK. A major disruption of the yields on
government securities was caused by the loose monetary policies worldwide during the global
financial crisis in 2008/2009, which led to a sharp decrease of yields on short term securities.
Mediumand longterm obligations were affected less strongly. For instance, the yield on
Indexed Government Treasury obligations with three months to one year maturity (MEIKAM)
decreased from 9.1% at the end of 2007 to around 2% at the end of 2010. Longterm
government Treasury obligations (MEUKAM) and Longterm Savings Government Treasury