Mali - Joint Bank-Fund Debt Sustainability Analysis - Risk and Stress Test Findings

Jul 19, 2026

Joint World Bank-IMF debt sustainability analysis for Mali finds the overall risk of debt distress remains moderate, while vulnerabilities increase compared with the 2021 assessment. Public debt rises rapidly to about 50.4% of GDP and is projected near 60% over the medium term. External debt indicators stay below thresholds under baseline conditions, but customized scenarios and stress tests reveal persistent breaches under commodity-price shocks and limited capacity to absorb shocks. Stronger fiscal consolidation, concessional borrowing, and improved debt coverage and reporting are emphasized to support future sustainability.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages21

Reading Time53 min

Findings on debt distress risk

External debt distress and judgment on granularity

Overall debt risk and stress-test breaches

Policy implications for sustainability

Debt coverage, classification, and data caveats

Public debt scope and state-owned enterprise liabilities

External debt classification by currency and residency uncertainty

Contingent liabilities and scenario calibration

Public Disclosure Pub lic Disc losure Authorized Approved by: Abebe Adugna and Manuela Francisco (IDA); Montfort Mlachila and Boileau Yeyinou Loko (IMF) Prepared by the staff of the International Development Association (IDA) and the International Monetary Fund (IMF) . | MALI: JOINT BANK-FUND DEBT SUSTAINABILITY ANALYSIS | | | --- | --- | | Risk of external debt distress | Moderate | | Overall risk of debt distress | Moderate | | Granularity in the risk rating | Limited space to absorb shocks | | Application of judgment | Yes | Mali’s public debt remains at moderate risk of overall debt distress—unchanged from the 2021 debt sustainability analysis.1 However, vulnerabilities have increased. Public debt has increased rapidly over the past five years (by 14 percentage points to 50.4 percent of GDP in 2021) as well as relative to the 2021 DSA. Over the medium term, the public debt-to-GDP ratio is projected to reach around 60 percent. The mechanical risk rating of external debt distress is low. However, under a customized scenario where external debt is classified as quasi-residence-based, the two external debt service indicators persistently breach their thresholds for distress during the forecast horizon. Reflecting these breaches, judgment has been applied to the granularity of the risk rating to indicate limited space to absorb shocks. For overall debt, stress tests suggest that the present value (PV) of the public debt-to-GDP ratio exhibits a prolonged and substantial breach of its benchmark under a scenario of commodity price shocks. Furthermore, like other WAEMU countries, government spending not captured by the fiscal deficit has been contributing to the rise in Mali’s public debt. A customized scenario with stock-flow adjustments, assuming that these ‘below-the-line operations’continue (in line with historical averages), shows public debt rising above the threshold. To ensure debt sustainability in the future, stronger fiscal consolidation will be necessary. This includes limiting future borrowing to concessional terms to minimize interest costs, as well as resolving security and political issues. Finally, tighter financial conditions in 1 The DSA analysis reflects a debt carry capacity of Medium considering Mali’s composite indicator index of 2 .90, based on the IMF’s October 2022 World Economic Outlook and the 2021 World Bank Country Policy and Institutional Assessment (CPIA) . the regional securities market pose significant risks to sustainability, requiring prudent cash management and clear and timely communication with creditors to carefully manage any liquidity shortfalls 1. Mali’s public debt covers the external and domestic obligations of the central government (Text Table 1 and 2) . State and local government entities do not borrow directly on their own. A detailed breakdown of the debt of state-owned enterprises (SOE) is currently not available, but the liabilities are estimated to be large. Staff are therefore supporting authorities’ efforts to broaden the coverage of public debt reporting to include the debt of SOEs and other public institutions.2 Improvements in debt recording and reporting are critical. External debt is classified by currency denomination 3 due to data limitation, staff are not able to track the residency of holders of government securities. Rule of thumb estimates based on auction data suggests the amount of external debt as defined by creditor residency is likely to be significantly larger. The DSA model-based output about external debt sustainability should, therefore, be treated with more caution. 2. A contingent liability test with tailored magnitude of shocks is applied to reflect the potential impacts of additional liabilities (Text Table 2) . The component of the contingent liability shock related to SOEs, which are not accounted for in the public sector coverage, is assumed to be 8 percent of GDP, 6 percentage points higher than the default setting. That reflec

FAQs

What is the assessed risk level for Mali’s debt distress in this analysis?

The overall risk of debt distress is rated moderate, unchanged from the 2021 assessment. The external debt distress risk is also assessed as moderate in aggregate, with important scenario-dependent breaches.

Why do customized scenarios lead to threshold breaches for external debt service indicators?

Under a customized classification treating external debt as quasi-residence-based, two external debt service indicators persistently breach their distress thresholds during the forecast horizon, prompting the use of judgment on risk granularity.

What factors are driving the increase in Mali’s public debt compared with 2021?

Public debt increases rapidly over the past five years due to higher public debt relative to the 2021 baseline, projected spending not captured by the fiscal deficit, and “below-the-line” stock-flow adjustments that add pressure if they continue.

Jul 19, 2026

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