ABSTRACT
INTRODUCTION Public debt management became a key policy issue for a number of highly indebted industrialized countries in the late 1970s and early 1980s, when public debt accumulation accelerated significantly following the emergence of primary fiscal imbalances, the large increase in real interest rates and the concurrent slowdown in economic growth. Although some of the high debt countries, such as Ireland and Denmark, have succeeded in reversing the increasing trend of the debt-to-GDP ratio, the burden of public debt remains significant today in several economies. In 1993, for example, debt-to-GDP ratios exceeded 100 per cent in Belgium, Greece and Italy; in the same countries, interest payments on public debt exceeded 10 per cent of GDP.
