A/HRC/43/45/Add.2 Independent Expert learned that this exercise has not been regularly carried out. A number of interlocutors highlighted a lack of disaggregated data and technical capacity, shedding light on potential areas for improvements. To ensure that these assessments become systemic practice, as prescribed by law, improved data collection and strengthened technical capacity are key. B. Public and private debt 28. According to the Ministry of Finance, the public debt of Mongolia went from 78.8 per cent of GDP in 2016 to 58.9 per cent of GDP in 2018. From the outset, the significant decrease in public debt since the most recent economic downturn should be underscored. 29. This was also highlighted by international financial institutions, although relying on different figures, taking into consideration that neither State-owned enterprises’ debt nor the central bank’s liabilities for swap lines were included in official numbers. Despite this discrepancy, a considerable decrease in public debt, from 87.6 per cent in 2016 to 73.3 per cent in 2018, was also observed by the IMF.39 30. The Fiscal Stability Law, adopted in 2010, aims to establish fiscal management principles and requirements to ensure fiscal stability and provides that the country’s net public debt should not exceed 40 per cent of GDP from 2014 (art. 19.3). Since 2015, the public debt level has remained within the debt ceiling set by law; however, the debt ceiling has been adjusted numerous times over the years.40 In this regard, principle 12 of the guiding principles provides that debt sustainability analysis should incorporate human rights impact assessments. 31. The total outstanding external debt has, overall, been on an upward trend. Figures indicate a jump of approximately $4 billion since 2016, from $24.6 billion at the end of 2016 to $28.7 billion at the end of 2018.41 According to IMF, the figure could reach $33 billion by 2021.42 32. In terms of debt to GDP, the debt decreased slightly, by 20 percentage points, in 2018. Currently amounting to 220 per cent of GDP, it is still extremely high. According to IMF, the high level of external debt is the result of several factors, including the financial needs of the mining sector.43 33. The remaining, private, part of external debt is composed of domestic debt (mortgages, consumption and companies) and other external debt (mainly mining corporations). 44 While public debt has not reached alarming levels, debt sustainability analysis should incorporate a human rights dimension so that the implications of debt levels on these rights are duly taken into account by the relevant financial authorities.45 A very high level of private debt can pose systemic risks to the economy, which needs to be prudently managed. 46 The guiding principles provide that States should have a transparent and democratically discussed bailout and interest rate formation regime established by law and use a mix of tools to ensure appropriate global and domestic financial market regulation with the aim of curbing excessive credit growth, including measures of prudential regulation, debt sustainability analysis and capital controls (A/HRC/40/57, para. 11.10). 34. State-owned enterprises’ liabilities are not included in official debt figures, although this does not prevent Government’s liability in case of default. This is not a purely technical disquisition: Mongolia has borrowed from various private partners to conduct a number of 39 40 41 42 43 44 45 46 IMF, Mongolia: 2019 Article IV Consultation, table 1. David Mihalyi and Liliana Fernández, “How did fiscal rules hold up in the commodity price crash?”, Natural Resource Governance Institute, June 2018, p. 18. Bank of Mongolia, Annual Report 2018, p. 17. IMF, Mongolia: 2019 Article IV Consultation, p. 51. Ibid. See www.mongolbank.mn/eng/liststatistic.aspx?id=4_3. See guiding principles (A/HRC/40/57), principle 12. Trade and Development Report 2019 (United Nations publication, Sales No. E.19.II.D.15), p. 76. 7