Foreword

This edition of the OECD Sovereign Borrowing Outlook presents an analysis of the recent trends in sovereign borrowing needs and outstanding debt and provides projections for 2023 for the OECD area. It examines the recent developments in funding conditions including the rising interest rates and changing investor base for the government securities markets and sovereign issuers. It analyses the recent trends in sovereign sustainable bond issuance including benefits and challenges for issuers and presents country practices that can assist sovereign issuers in their efforts to meet those challenges. It also reviews sovereign debt issuance trends in Emerging Market and Developing Economies (EMDEs) and examines the issuance conditions in 2022. Finally, this edition also provides policy guidance on developing and implementing buyback and switch programmes as a debt management tool in view of the OECD country practices.

The publication draws mainly on responses received to an annual survey on the borrowing needs of OECD governments circulated by the OECD’s Financial Markets Unit in 2022. This includes an update on trends and developments associated with sovereign borrowing requirements, funding strategies, market infrastructure and debt levels from the perspective of public debt managers. The Outlook makes a policy distinction between borrowing requirements and funding strategies. Central government marketable gross borrowing needs, or requirements, are calculated on the basis of budget deficits and redemptions. Funding strategies entail decisions on how borrowing needs are going to be financed using different instruments (e.g. long-term, short-term, nominal, indexed, etc.) and which distribution channels (auctions, tap, syndication, etc.) will be used.

The OECD conducted a special survey study on the ‘Sovereign Debt Exchange and Buybacks’ among OECD member and accession countries in 2022. Chapter 4 draws mainly on the responses to this survey.

Comments and questions should be addressed to the Financial Markets Unit within the Capital Markets and Financial Institutions Division of the OECD Directorate for Financial and Enterprise Affairs (e-mail: [email protected]). Find out more about OECD work on bond markets and public debt management online at www.oecd.org/finance/public-debt/.