[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"doc-detail-111515-en":3,"doc-seo-111515-105":29,"detail-sidebar-cat-0-en-105":82},{"code":4,"msg":5,"data":6},0,"success",{"doc_id":7,"user_id":8,"nickname":9,"user_avatar":10,"doc_module":4,"category_id":11,"category_name":12,"doc_title":13,"doc_description":14,"doc_content":15,"file_id":16,"file_url":17,"file_type":18,"file_size":19,"view_count":4,"is_deleted":4,"is_public":20,"is_downloadable":20,"audit_status":20,"page_count":21,"language":22,"language_code":23,"site_id":24,"html_lang":23,"table_of_contents":25,"faqs":26,"seo_title":13,"seo_description":14,"update_tm":27,"read_time":28},111515,8796095461564,"Liam","https://ap-avatar.wpscdn.com/davatar_155a257f0dc6eb9ab79c44ca47cae57d",8,"Research & Report","Kiribati - Joint World Bank-IMF Debt Sustainability Analysis - Debt distress risk assessment","Kiribati’s 2024 Low-income Country Debt Sustainability Analysis evaluates debt-distress risk as high, yet sustainable under the baseline scenario. Judgment extends the projection horizon to 20 years to reflect climate-change impacts on debt dynamics. Rising fiscal deficits in 2022, driven by high recurrent spending and falling fishing revenues, ease in 2023 with revenue recovery and grants, while medium-term deficits are projected to widen due to higher civil-service wages and sustained social protection. Despite export and growth shocks sensitivity in stress tests, mitigating factors—continued access to concessional financing, large cash buffers, and limited long-term breaches—support overall sustainability.","Public Disclosure  \nPub lic Disc losure Authorized  \nApproved by:  \nLalita Moorty and Manuela Francisco (IDA) and Corinne Deléchat and Fabian Bornhorst (IMF)  \nPrepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) .  \n\n| KIRIBATI: JOINT BANK-FUND DEBT SUSTAINABILITY ANALYSIS |  |\n| --- | --- |\n| Risk of external debt distress | High |\n| Overall risk of debt distress | High |\n| Granularity in the risk rating | Sustainable |\n| Application of judgment | Yes. The projection horizon was extended to 20 years to capture the impact of climate change on debt dynamics. |\n\nThe 2024 Low-income Country Debt Sustainability Analysis (LIC DSA) indicates the risk rating of debt distress for Kiribati remains high but is sustainable.1 Judgment was applied to extend the projection horizon to 20 years as opposed to the standard 10 years. This is to adequately capture Kiribati’s vulnerability to climate-related events on debt dynamics. High recurrent spending amid a decline in fishing revenue has led to large fiscal deficits in 2022. The fiscal deficit in 2023 is reduced due to the recovery of fishing revenue and strong grants despite the introduction of the leave grants for private sector employees. Increasing civil service wages while maintaining the existing high social protection spending as in the 2024 budget will lead to large fiscal deficits over the medium term. It is a departure from the surpluses prior to the pandemic. As a result, the ratio of the present value (PV) of the public and publicly guaranteed (PPG) external debt-to-GDP is expected to breach the indicative threshold starting in 2036 under the baseline scenario. The PV of the total public debt-to-GDP ratio is expected to remain below the indicative benchmark under the  \n1 Kiribati’s Composite Indicator (CI) index is 2.689 calculated based on the October 2023 World Economic Outlook (WEO) and the 2022 Country Policy and Institutional Assessment (CPIA) . The current CI score implies weak debt-carrying capacity. As two consecutive assessments of “weak” are needed to adjust the debt-carrying capacity classification from “medium” to “weak”, Kiribati’s debt-carrying capacity classification remains “medium”.  \nbaseline scenario. Stress tests confirm the vulnerability of the debt position to exports and growth shocks. Despite high risk of debt distress, Kiribati’s debt trajectory is assessed to be sustainable. It is due to several mitigating factors:(i) the country currently benefits from grant-only status for financing from the multilateral development banks (MDBs) and it is likely to maintain access to highly concessional financing over the long term; (ii) the government has large cash buffers which can be drawn on to finance deficits in the near term; and (iii) in the baseline, the breaches occur only in the long term and only for the PV of the external debt-to-GDP ratios, while all the other ratios are expected to remain well below their indicative thresholds. Although Kiribati does not currently face debt servicing risks thanks to its high cash buffers, risks from unfavorable weather conditions or a downturn in global financial markets (which would reduce the value of Kiribati’s sovereign wealth fund) call for greater fiscal prudence. Adhering to a prudent withdrawal rule for the sovereign wealth fund is crucial to reduce the risk of a gradual depletion of the fund. Fiscal consolidation, by scaling back recurrent spending and reducing reliance on volatile sources of revenues, is needed to safeguard sustainability. Further progress in structural and fiscal reforms, such as strengthening the fiscal policy framework, improving public financial management, and placing the state-owned enterprises (SOEs) on a commercial and sustainable footing, is also needed to improve debt trajectories and safeguard medium- and long-term fiscal sustainability. Containing the risk of debt distress also requires continuing grants to support the ","cbCaibwNcSHBMSeU","https://ap.wps.com/l/cbCaibwNcSHBMSeU","pdf",963877,1,22,"English","en",105,"# Risk ratings and projection horizon\n## Baseline assessment and judgment\n# Fiscal dynamics and debt indicators\n## Deficits, grants, and spending pressures\n## Breaches of indicative thresholds\n# Stress tests and vulnerability channels\n## Exports and growth shocks\n# Mitigating factors and policy recommendations\n## Cash buffers, concessional financing, and prudence\n## Fiscal consolidation and reforms","[{\"question\":\"What main factors explain the sustainability despite high risk?\",\"answer\":\"Mitigating factors include continued access to highly concessional, grant-only multilateral financing, large cash buffers to finance near-term deficits, and breaches occurring only in the long term for specific external debt-to-GDP measures.\"}]",1784490480,55,{"code":4,"msg":30,"data":31},"ok",{"site_id":24,"language":23,"slug":32,"title":13,"keywords":33,"description":14,"schema_data":34,"social_meta":77,"head_meta":79,"extra_data":81,"updated_unix":27},"kiribati-joint-world-bank-imf-debt-sustainability-analysis-debt-distress-risk-assessment","",{"@graph":35,"@context":76},[36,53,67],{"@type":37,"itemListElement":38},"BreadcrumbList",[39,43,47,50],{"item":40,"name":41,"@type":42,"position":20},"https://docshare.wps.com","Home","ListItem",{"item":44,"name":45,"@type":42,"position":46},"https://docshare.wps.com/document/","Document",2,{"item":48,"name":12,"@type":42,"position":49},"https://docshare.wps.com/document/research-report/",3,{"item":51,"name":13,"@type":42,"position":52},"https://docshare.wps.com/document/kiribati-joint-world-bank-imf-debt-sustainability-analysis-debt-distress-risk-assessment/111515/",4,{"url":51,"name":13,"@type":54,"author":55,"headline":13,"publisher":57,"fileFormat":60,"inLanguage":23,"description":14,"dateModified":61,"datePublished":61,"encodingFormat":60,"isAccessibleForFree":62,"interactionStatistic":63},"DigitalDocument",{"name":9,"@type":56},"Person",{"url":40,"name":58,"@type":59},"DocShare","Organization","application/pdf","2026-07-19",true,{"@type":64,"interactionType":65,"userInteractionCount":4},"InteractionCounter",{"@type":66},"ViewAction",{"@type":68,"mainEntity":69},"FAQPage",[70],{"name":71,"@type":72,"acceptedAnswer":73},"What main factors explain the sustainability despite high risk?","Question",{"text":74,"@type":75},"Mitigating factors include continued access to highly concessional, grant-only multilateral financing, large cash buffers to finance near-term deficits, and breaches occurring only in the long term for specific external debt-to-GDP measures.","Answer","https://schema.org",{"og:url":51,"og:type":78,"og:title":13,"og:site_name":58,"og:description":14},"article",{"robots":80,"canonical":51},"index,follow",{"doc_id":7,"site_id":24},{"code":4,"msg":5,"data":83},[84,88,92,96,101,106,111,114,119,122,126],{"id":20,"doc_module":4,"doc_module_name":45,"category_name":85,"show_sort_weight":86,"slug":87},"Story & Novel",90,"story-novel",{"id":46,"doc_module":4,"doc_module_name":45,"category_name":89,"show_sort_weight":90,"slug":91},"Literature",80,"literature",{"id":52,"doc_module":4,"doc_module_name":45,"category_name":93,"show_sort_weight":94,"slug":95},"Exam",70,"exam",{"id":97,"doc_module":4,"doc_module_name":45,"category_name":98,"show_sort_weight":99,"slug":100},5,"Comic",60,"comic",{"id":102,"doc_module":4,"doc_module_name":45,"category_name":103,"show_sort_weight":104,"slug":105},6,"Technology",50,"technology",{"id":107,"doc_module":4,"doc_module_name":45,"category_name":108,"show_sort_weight":109,"slug":110},7,"Healthcare",40,"healthcare",{"id":11,"doc_module":4,"doc_module_name":45,"category_name":12,"show_sort_weight":112,"slug":113},30,"research-report",{"id":115,"doc_module":4,"doc_module_name":45,"category_name":116,"show_sort_weight":117,"slug":118},9,"Religion & Spirituality",20,"religion-spirituality",{"id":117,"doc_module":4,"doc_module_name":45,"category_name":120,"show_sort_weight":117,"slug":121},"World Cup","world-cup",{"id":123,"doc_module":4,"doc_module_name":45,"category_name":124,"show_sort_weight":123,"slug":125},10,"Lifestyle","lifestyle",{"id":127,"doc_module":4,"doc_module_name":45,"category_name":128,"show_sort_weight":97,"slug":129},19,"General","general"]