HOW TO CLASSIFY DEBT DATA:

INTERNATIONAL STANDARDS

1. Each country can report to international financial institutions using its own classifications of debt.
2. There is one main standard that should be followed to classify debt.
3. The institutional sectors of the economy as defined by the System of National Accounts are used to classify debt.

The ultimate purpose of recording debt data is to provide different types of information on debt,
including statistics, to allow for an analysis of the country’s debt situation and well-founded deci-
sion-making. Consequently, debt information needs to be structured or organized according to
various criteria or categories. This requires that debt data be classified.
How should the debt office classify debt data? By following internationally agreed classifica-
tions! In this way, it can ensure consistency and compatibility between the different national systems of statistics and na-
tional accounts and also guarantee the comparability of data reported internationally.
International initiatives to provide guidance on debt concepts, definitions and classifications were undertaken before the
late 1990s, in particular on external debt. Since then, new statistical guidelines have been produced and an effort was
made internationally to harmonize the definitions and classifications used in different statistical systems, namely:

 The System of National Accounts (SNA) 2008, adopted compilation advice, for the measurement of pub-
by the United Nations Statistical Commission. The lic sector debt, including a definition of debt con-
SNA is the internationally agreed standard set of rec- cepts relating to the public sector debt.
ommendations on how to compile measures of eco-
 External Debt Statistics: Guide for Compilers and Us-
nomic activity. One conceptual element of the SNA
ers, published by the IMF in 2013. This guide pro-
is the breakdown of the economy in institutional sec-
vides guidance for the measurement and presen-
tors, with each sector composed of institutional units.
tation of external debt statistics of public and pri-
This classification of institutional sectors is used for
vate sectors, including guidance on concepts, defi-
debt statistics. Also, the SNA provides a chapter on
nitions and classifications of external debt.
the general government and public sectors, including
definitions and presentation of statistics.  The Government Finance Statistics Manual 2014, pub-
lished by the IMF. It provides a comprehensive
 The Balance of Payments and International Investment
conceptual and reporting framework suitable for
Position Manual (BPM6), published by the IMF in 2009.
analyzing and evaluating fiscal policy, especially the
It provides a standard framework for statistics on the
performance of the general government sector
transactions (flows) and positions between an econo-
and the broader public sector of any economy.
my and the rest of the world. It also describes the
principles of residence and valuation.  The Handbook on Securities Statistics, published by
the IMF in 2015. It provides a conceptual frame-
 Public Sector Debt Statistics: Guide for Compilers and
work for the compilation and presentation of
Users, published by the IMF in 2011. This guide pro-
securities statistics, including debt securities.
vides a comprehensive conceptual framework, and
Classification implies the creation and use of struc- International standards described previously provide
tured sets of complete, mutually exclusive and well- the grounds for classifying debt according to the:
described categories. Debt classifications must reflect  Residence of the creditor
the main characteristics of the debt and each set  Public or private sector of the debtor
should be complete.  Institutional sector of the debtor
Usually, the computer-based debt management system  Type of debt instrument
(CBDMS) used by the debt office offers embedded clas-  Maturity
sifications of debt, including automatic classifications, de-  Currency
 Creditor sector
rived from data recorded by users. These classifications
 Etc.
are associated with a coding system.

This chart presents an example of structure for public external debt, which shows several levels of classifications.
These are not exhaustive and are not meant to be hierarchical. For example, the instrument type presented at level
6 could easily be at level 2.

“The use by statistical agencies in each country

of international concepts, classifications and
methods promotes the consistency and efficien-
cy of statistical systems at all official levels”.
Fundamental Principles of Official Statistics,
United Nations Statistical Commission

© DMFAS Programme, 2017

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