MEFMI/UNITAR e-Learning Course on "Domestic Debt Sustainability Analysis (DDSA)" - Course Outline

Course Outline

This e-Learning course comprises of five modules, each of which will be offered over a one-week period during this ten-week e-Learning course. The five modules include:

MODULE 1:
INTRODUCTION TO DOMESTIC DEBT SUSTAINABILITY AND THE DYNAMICS BETWEEN BUDGET DEFICITS AND DEBT
The first module develops the definition of domestic debt and outlines the key components of domestic debt. Additionally, it provides the theoretical linkage between economic theory and debt sustainability. In particular, it provides the linkage between budget deficits and debt. The module also demonstrates the relationship between debt, growth and interest rates.

MODULE 2:
THEORETICAL MODELS OF DEBT SUSTAINABILITY ANALYSIS
The second module reviews the existing literature on models of debt sustainability. In particular, it discusses the Present Value Budget Constraint (PVBC) approach to domestic debt sustainability analysis. This is the approach adopted in the MEFMI study (2001) and demonstrated in this e-Learning course.

MODULE 3:
BASIC ECONOMETRIC TECHNIQUES
The third module is an outline of the basic econometrics techniques and concepts that users should be familiar with as key to embarking on the exercise of assessing the sustainability of domestic debt. The essential statistical tools that are central to understanding the econometrics discussed in this module are also presented in this module.

MODULE 4:
APPLICATION OF EVIEWS SOFTWARE
Module four demonstrates the application of the Eviews software to assess the sustainability of debt.

MODULE 5:
DOMESTIC DEBT SUSTAINABILITY ANALYSIS FOR A TYPICAL MEMFI MEMBER STATE
Module five is a practical demonstration of how domestic debt sustainability analysis can be undertaken. This practical example uses data from a MEFMI member state.

The e-Learning has been simplified to make it very user friendly to even those with a minimal level of econometric and statistical knowledge. To fulfill this objective, the econometric concepts and terminologies have been presented in simple language with some ordinary examples given to illustrate some difficult concepts like stationarity and co-integration, where possible. In addition, the Eviews instructions and commands have been presented step by step to enable debt managers including those who are not familiar with the software to easily follow and conduct domestic debt sustainability analysis with minimal difficulties.