Банкеръ Daily


The Government Debt Reached BGN 24.29 Billion or 20.7% of GDP

Bulgaria's public debt has reached BGN 24.295 billion at the end of August, the current data of the Ministry of Finance show.

Domestic liabilities are BGN 5,986 billion and external liabilities - BGN 18,309 billion.

At the end of the reporting period, the debt ratio of the General Government sub-sector to the gross domestic product (GDP) amounted to 20.7%, with the share of the domestic debt being 5.1% and external debt - 15.6%. At the end of the period domestic liabilities held a share of 24.6 percent and external liabilities - of 75.4 percent, the ministry said.

However, these figures do not include the newly issued external debt amounting to BGN 5 billion through the sale of Eurobonds on the international markets.

The yield on the 10-year securities was 0.389%, and on the bonds with a maturity of 30 years - 1.476%.
The total amount of the two tranches is BGN 5 billion or EUR 2.5 billion.

For comparison, in the last two sales of bonds on the international markets - in 2015 and 2016, yields of 0.72% and 0.94% were achieved, respectively. Thus, within two GERB governments the foreign debt has increased by about BGN 15 billion.

According to the base prospectus of the issue, the funds will be used to increase the fiscal reserve. Some of the funds will be used to finance the planned budget deficit at the end of the year, while another will be used to re-pay liabilities and address the effects of Covid-19.

The Ministry of Finance expects to report a positive balance under the consolidated fiscal program of BGN 890 million as of September 2020. Ministry figures show that the budget surplus is melting down since it was BGN 1.6 billion a month ago.

According to Kiril Ananiev and his colleagues, this is due to the higher investment costs associated with infrastructure projects, payments under measure 60/40 and others.

The amount of the fiscal reserve as of 31.08.2020 is BGN 9.47 billion.

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