SUDANESE GOVERNMENT'S COLLABORATION WITH DMFAS

Presented by: Mrs.Kaltoum Satti Ali

Manager General Directorate of Public Debt Management

Republic of Sudan

1

Outlines

Overview of Sudan's debt

Responsibilities of the DMO

DMFAS 6.2

Training

Achievements

Challenges

Lessons learned

Plans for the future

Recommendations

Conclusion 2

Overview of Sudan's debt Sudan has accumulated sizeable external arrears

since 1970s

its debt burden grew substantially with obligations

reaching over USD 45 billion by EOY 2016.

87% of this debt were arrears

Sudan remains a highly indebted country

3

Multilateral Creditors 12%

NonParis Club 39%

Paris Club 31%

Commercial Banks 13%

Foreign Suppliers 5%

Sudan External Debt As of 31st of Dec. 2016

4

Domestic Causes of Debt Accumulation:

Poor exchange rate policies in the 1970s and 1980s fed directly into the debt problems

High inflation rates contributed to economic instability and low economic growth, while foreign direct investment remained scarce in the volatile economic environment.

the second civil war in Southern Sudan(1983 to 2005)absorbed precious financial resources

Also during this time, numerous droughts hurt the economy‘s relatively large agricultural sector.

5

External Causes of Debt Accumulation:

Two oil price shocks occurred in the late 1970s and early 1980s

Global ant-iinflation efforts in creditor countries resulted in higher interest rates and faster accruing interest levels for indebted countries.

he drying up of concessional credits forced Sudan to resort to ̳harder‘ lending terms

A set of political and economic embargoes deprived the country from approaching the international capital markets

6

Prime Minister

Governor of Central Bank of

Sudan

GD of Stock Exchange and

Foreign Currencies

External Debt Unit Sudan Financial

Service Company

Minister of Finance

State Minister OF Economic Plan

Undersecretary of Economic Planning

GD of Public Debt

External Debt Directorate

Domestic Debt Directorate

Guarantees SUKUK Subsidiary

Agreements

GD of Foreign Finance

State Minister of Budget

Undersecretary of Budget

Current Organizational Structure of Debt Management in Sudan

7

Current Organizational Structure of DMGD

DMGD

External Debt

Monitoring & Registration

Repayments Loans

Domestic Debt

Monitoring &

Registration SUKUK Guarantees

Subsidiary Agreements

8

Future Organizational Structure of DMGD

DMGD

External Debt

Front Office

Middle Office

Back Office

Domestic Debt

Front Office

Middle Office

Back Office

9

History of the acquisition of the DMFAS

1999: AfDB technical assistance :

installation and use of DMFAS 5.2 at

CBOS by UNCTAD

2005: Norwegian grant : installation of DMFAS 5.3 at Centarl

bank of Sudan (CBOS) by UNCTAD

2015: AfDB Financial support: installation

of DMFAS 6.2 at MoFEP By UNCTAD

10

Technical Assistance &Training received

1999: AfDB technical assistance under

Institutional Strengthening Program in

three categories, installation and use of

DMFAS 5.2, internal training of staff in the debt Unit in form of recording, reporting

besides the computer utilities program, and

external training in Egypt.

2004: Norwegian government grant : installation & use of

DMFAS 5.3, debt data validation, the

production of the debt statistical bulletin, the

drafting of a Procedures Manual, DPA and various

study tours and seminars.

2005: DFID project in the field of loan negotiation & evaluation, Paris Club

& Commercial Banks rescheduling, Financial Transactions and study

tours

Technical Assistance received from different donors

11

Training received:

2007 Mission on work programming, project

management and other issues.

2008 Debt Data Validation Workshop, DPA Workshop

2009 Debt statistics, DPA Workshop

2010 training on new version of DMFAS 6 and its new features.

12

Current Project with UNCTAD Training & Technical support received:

Evaluation of institutional, legal and organizational arrangements of Debt management in Sudan 28 September -8 October 2015.

Evaluation of training needs for MoFEP during 24 May -1st of June 2016.

DMFAS Advance Training :26 March-6 April 2017 and 26 March-13 April 2017

Basic functional training for DMFAS new users at MoFEP during 14-25 August 2016 and during 21 August - 8 September 2016.

Technical support and training in installation of DMFAS 6.2 during 14-25 August 2016

Workshop on production of Debt Statistical Bulletin during the period 6-16 August 2017

Workshop on Debt Portfolio Analysis ( DPA) during the period 15-19 October 2017.

13

Current Project with UNCTAD Training & technical support received (cont…):

Conversion of data base of DMFAS 5.3 to DMFAS 6.2.

Technical support for Debt data migration and validation based on DMFAS standards 1st of July-12 August 2016

Drafting of a debt Procedures Manual,

Continuous IT backup by technical support.

Debt management team Participation in the 11th UNCTAD conference.

14

What DMFAS is used for?

Recording of loans

• External Loans

• Domestic Loans

• SUKUK

• Guarantees

• Subsidiary Agreements

Reporting

Analysis

15

Main achievements

Unification of public debt (domestic and external debt) at MoFEP.

DMFAS users at MoFEP are capable to use the basic functionalities of DMFAS 6. (i.e. external and domestic debt modules and production of standard reports.)

Upgrading of the capacities of debt mangers and operation staff in debt portfolio Analysis..

Production of the Draft Statistical Bulletin.

Recoding and analysis of domestic debt instruments under guidance of DMFAS Experts..

Enhancing capacities in analysis and repotting for both external and domestic debt..

Provide required data and statistics for policy/decision makers..

16

Challenges encountered Strengthening the legal and institutional framework for Public Debt Management

Coordination and collaborating between institutions responsible for public debt management within the country.

Secure funds for continues human and institutional capacity building in public debt management.

Staff turnover and periodic movement.

Technical problems regarding integration with PFM systems.

17

Lessons learned

DMFAS 6 enabled MoFEP in public debt recording, analysis and reconciliation.

DMFAS 6 enabled More to record and create all needed types of demotic debt instruments mainly Islamic types (i.e Sukuk)

DMFAS 6 in more advanced compared to the old versions in terms of the technical and functional features.

It enables countries to understand their debt structure and position.

It Provides timely information to debt managers and policy/decision makers

18

Plans for the future

Designing and formulating of Medium Term Debt Strategy.

Establishment of of Analysis and Reporting Office at DMGD(MoFEP) (within 3 months)

Continuation of capacity building programs for the new comers to DMGD

19

Plans for the future (cont…)

Execution of Payments using DMFAS and Government Resource Planning System (GRP) (DMFAS Integration with GRP System).

Establishment of special Unit for production and dissemination of Sudan Public Debt and Sudan’s Debt Statistics Bulletin.

20

Recommendations for other countries

Using DMFAS 6 is very important for it was designed to help countries manage their external and domestic public debt.

Using DMFAS 6 is very essential for it depends on reliable database and keeps debt managers and decision makers up-to-date

It enables continues improving their Debt recording, analysis and reporting.

DMFAS 6 as a web-based solution enables integration with PFM systems.

21

Conclusion:

Installation of DMFAS 6 represents a big achievements for our country in terms of public Debt Management.

I will take this opportunity on behalf of Sudanese delegation to extends our appreciation and thankful to the UNCTAD and the African Development Bank for their continues technical and financial support.

22

THANKS FOR ATTENTION

.

23