Blog: Leveraging AI in a complex public debt management environment  

07 November 2024
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Managing public debt is often the largest and most complex portfolio in many countries. Artificial Intelligence (AI) could be a strategic game-changer for Debt Management Offices in making their public debt management processes more efficient, enhancing data analytics, and improving transparency.  

Blog by Shaleen Surendra, Debt Management Unit Programme Assistant; Delia Cox, Public Debt Management Adviser; and Mac Banda, Adviser & Team Leader of the Commonwealth Meridian  

AI has made rapid advances over the last few years. While there are concerns surrounding its use, it is vital to consider the benefits, such as AI’s ability to analyse large datasets and forecast complex scenarios through machine-learning algorithms.  

The challenges 

Debt managers face a myriad of challenges, including the unavailability of data, lack of quality data and unstructured workflow processes. To leverage AI for effective public debt management, it is important to first understand the opportunities and challenges in this fast-evolving field.  

The Commonwealth Secretariat’s Debt Management Unit, in collaboration with the Macroeconomic and Financial Management Institute of Eastern and Southern Africa (MEFMI), set out to do just that in a recent training event for member countries.  

In a session titled Leveraging Artificial Intelligence for Effective Public Debt Management, we highlighted some issues: rising debt levels; debt sustainability challenges and maintaining debt sustainability levels; growing pressure to improve transparency in debt reporting, and ensuring reliable data is available for decision-making.  

There are also challenges for debt management technical assistance providers - like the Commonwealth Secretariat – considering the geographical distribution of the 56 member countries. This, coupled with the time differences, can make it difficult to address concerns urgently and provide timely assistance.  

In her opening remarks, Dr Ruth Kattumuri, Senior Director of Economic, Youth and Sustainability Development at the Commonwealth Secretariat, talked about inherent creative talents of human beings and asserted that the performance of machines is fundamentally determined by human intelligence and abilities. She also outlined some of the risks involved, such as potential job losses when machines replace humans and stressed the need for continued training and upskilling to navigate the changing nature of jobs.  

Additionally, Dr Kattumuri highlighted the risks of the malicious use of AI and reiterated the importance of global governance to harness its potential for the good of humanity. On the question of whether AI could replace a public debt manager, she explained that machines are not yet able to do so and, while integrating AI technology will provide support for debt analyses and management, the domain expertise remains with debt managers.

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Dr Ruth Kattamuri
Dr Ruth Kattumuri, Senior Director of Economic, Youth and Sustainability Development at the Commonwealth Secretariat

Staying ahead of the curve

AI can generate real-time data analysis, enabling debt managers to make better data-driven decisions. It can also aid in risk mitigation, cost minimisation, improved communication by using chatbots and virtual assistants, as well as compliance, as AI can monitor and flag issues. Jacob Mkandawire, Director of Debt Management at MEFMI, highlighted that AI offers solutions to debt managers that enhance innovation and adaptability in their work.  

He also cautioned that debt managers must stay ahead of the curve and continue to add value, as AI will continue to shape the future of debt management. With data privacy risks and regulatory issues, it is important that debt managers are knowledgeable about AI.  

Bernhard Obenhuber, Managing Partner at CountryRisk.io, shared practical insights of how debt managers can leverage by demonstrating the platform’s latest AI innovations, which can be used to evaluate sovereign and country risk. This includes bespoke tools that allow users easy navigation and access, increasing client productivity and research quality. 

The benefits are potentially immense, which is why the Commonwealth Secretariat is in the initial stages of developing a project that aims to support member countries to use AI in the debt management process.  

The project aims to encourage debt managers to embrace AI and will address the existing gap in AI adoption across the Commonwealth. It is also hoped that the initiative will help to improve the processes and mitigate some of the capacity-building challenges that impede good governance.



Media contact

  • Suné Kitshoff   Senior Communications Officer, Communications Division, Commonwealth Secretariat

  • M: +44 7740 450 901  |  E-mail