Међузависност ризика неплаћања јавног дуга и солвентности земаља чланица монетарне уније // The Correlation between the Risk of Default and Solvency of Member States of the Monetary Union

2018 ◽  
Vol 13 (23) ◽  
pp. 69
Author(s):  
Бранка Топић-Павковић
Keyword(s):  
Interest Rates ◽  
Monetary Union ◽  
Public Debt ◽  
Debt Crisis ◽  
Causal Connection ◽  
Member States ◽  
Government Bonds ◽  
The Public ◽  
The Government ◽  
The Eu

Резиме: Дужничка криза у земљама Европске монетарне уније истакла је значај вођења одговорне фискалне политике, посебно у оквиру питања одрживости јавног дуга и солвентности земаља чланица. Општа правила за контролу нивоа јавног дуга, уведена у ЕУ, предвиђају обавезујуће мјере за све чланице када њихов јавни дуг пређе границу од 60% БДП-а, као и правила о максималном износу удјела дефицита у БДП-у. Интензитет дужничке кризе одређен је повјерењем инвеститора које зависи од економских фундамената, али и процјене да ли ће влада досљедно измиривати своје обавезе. Циљ истраживања јесте да утврдимо да ли је однос дуга према БДП-у позитивно корелисан са кретањем каматних стопа на државне обвезнице и да одредимо степен њихове повезаности. На узорку од 17 земаља чланица ЕМУ и временским интервалима преткризног и кризног периода, корелационом и регресионом анализом указујемо на узрочно-посљедичну повезаност наведених индикатора и њихов утицај на солвентност земље. Резултати показују да се у случају кризе јавног дуга услијед повећања каматних стопа на дугорочне државне обвезнице, значајно повећава удио јавног дуга у БДП-у што води расту ризика неплаћања дуга и посљедично несолвентности земаља чланица. Фискални аспект интеграције БиХ, посматрани кроз призму фискалних критеријума ЕУ, показују минимална одступања од референтних вриједности. Међутим, имајући у виду да кретање нивоа јавног дуга, те његово сервисирање, директно зависе од степена повећања/смањења БДП-а, извоза и расположивог прихода за сервисирање дуга, одлуке о даљем задужи- вању морају бити повезане са производним пројектима или финансирањем пројеката који ће допринијети даљем привредном расту и расту конку- рентности.Summary: The debt crisis in the European Monetary Union, emphasized the importance of keeping a responsible fiscal policy, especially in the context of issues of public debt sustainability and solvency of the member countries. Common rules for control of the public debt was introduced in the EU provide for mandatory measures for all Member States when their public debt exceeds the limit of 60% of GDP, as well as rules on the maximum amount of deficit percentage of GDP. The intensity of the debt crisis is determined by the confidence of investors, which depends on economic fundamentals as well as assessing whether the government will consistently meet their obligations. The aim of the research is to determine whether the ratio of debt to GDP positively correlated to movements in interest rates on government bonds and to determine the degree of their coherence. In a sample of 17 EMU member countries and time periods pre-crisis and crisis period, correlation and regression analysis indicate a causal connection between these indicators and their impact on the solvency of the country. Results show that in the event of a crisis in public debt due to the increase in interest rates on long-term government bonds, significantly increasing the share of public debt in GDP, which increases the risk of non-payment of debt and consequent insolvency of member states. Fiscal aspect of integration of BiH observed through the prism of fiscal criteria of the EU show a minimum deviation from the reference value, however, given that the movement of the public debt servicing is directly dependent on the degree of increase/decrease of GDP, exports and disposable income to service the debt, decisions on further borrowing must be associated with manufacturing projects or production projects that will contribute to further economic growth and competitiveness.

scholarly journals Aнализа степена испуњености Мастрихтских критеријума конвергенције у Босни и Херцеговини // The analysis of the Bosnia and Herzegovina’s level of compliance with the Maastricht convergence criteria

2013 ◽  
Vol 11 (18) ◽  
pp. 337
Author(s):  
Бранка Топић-Павковић
Keyword(s):  
Interest Rates ◽  
Monetary Union ◽  
Public Debt ◽  
European Monetary Union ◽  
Monetary Integration ◽  
Convergence Criteria ◽  
European Monetary ◽  
Gradual Process ◽  
Productivity And Competitiveness ◽  
The Eu

Резиме: Идеја о формирању Европске монетарне уније (ЕМУ) произашла је из чињенице да монетарно интегрисање има значајне економске предности код снижавања трансакционих трошкова, веће транспарентности цијена и монетарну стабилност. Теорија оптималног валутног подручјa истиче позитивну везу високог степена конвергенције и постизања користи од интегрисања и вођења заједничке политике за земље чланице монетарне уније Мастрихтски критеријуми конвергенције подразумијевају да земља која улази у ЕМУ има релативно ниску инфлацију, стабилну валуту, низак ниво буџетског дефицита, одржив јавни дуг, као и релативно ниске каматне стопе. Прије стицања позиције кандидата за приступ у ЕМУ, Босна и Херцеговина мора постати чланом ЕУ, и испунити критеријуме за чланство који се односе на политичке, економске, административне и правосудне институције. Будући да су Мастрихтски критеријуми конвергенције прецизније дефинисани од осталих критеријума, у економској литератури често се користе као показатељ спремности земаља кандидата за приступ Е(М)У. Поред сагледавања теоријских и емпиријских сазнања о условима монетарног интегрисања, циљ овог рада је да, на основу компаративне анализе остварених економских перформанси БиХ и земаља региона, оцијенимо остварену конвергенцију и степен приближавања БиХ критеријумима конвергенције из Мастрихта. Резултати истраживања сугеришу да је за БиХ, након уласка у ЕУ, рационално рјешење постепен процес монетарне интеграције, који уз стабилну монетарну политику подразумијева ефикасно управљање јавним финансијама и опрезно управљање јавним дугом. Дугорочни циљ БиХ огледа се у достизању реалне конвергенције кроз повећање продуктивности и конкурентности.Summary: The idea of forming the European Monetary Union (EMU) derives from the fact that monetary integration has considerable economic advantages in lower transaction costs, greater price transparency and monetary stability. Аccording to the optimum currency area (OCA) theory, it is very important for member states to achieve high level of convergence in order to exploit advantages of integrating and conducting a common policy. Maastricht convergence criteria imply that a country that enters the European Monetary Union (EMU) has a relatively low inflation, a stable currency, low budget deficits, relatively low interest rates and sustainable public debt. Before gaining the position of candidates for EMU, Bosnia and Herzegovina has to become a member of the EU and to achieve the criteria for membership related to the development of political, economic, administrative and judicial institutions. Since the Maastricht convergence criteria are more precise than other criteria, in the economic literature are often used as an indicators of the readiness of the candidate countries to access the E(M)U. In addition to consideration of theoretical and empirical knowledge about the monetary integration, the main goal of this paper is to, using the comparative analysis of actual economic performance of BiH and the region, provides us with knowledge and assessment of BiH stage of compliance with the Maastricht convergence criteria. The results show that a rational solution for BiH, after joining the EU, is based on gradual process of monetary integration, with stable monetary policy, effective management of public finances and careful management of public debt. The long-term goal of BiH lies in achieving real convergence through increased productivity and competitiveness.

scholarly journals Public Debt under Financial Crisis in the New EU Member States

2014 ◽  
Vol 15 (1) ◽  
pp. 153-162
Author(s):  
Tomasz Uryszek
Keyword(s):  
Public Debt ◽  
Debt Management ◽  
Negative Effects ◽  
Debt Structure ◽  
Member States ◽  
The Public ◽  
Eu Member States ◽  
Public Debt Management ◽  
Management Institutions ◽  
The Eu

Abstract With the growing imbalance of public sectors in the EU Member States, the public debt in the countries increased too. Public debt management institutions face the task of choosing the optimal debt structure in order to minimize the negative effects for the economy. This article sets out to determine changes in the public debt structure in the EU Member States during economic crisis. It consists of four sections. Section one deals with public debt management under crisis conditions. In the next sections, the term, currency and lender structure of public debt in the new Member States are analysed and discussed. The last section presents major conclusions from the research.

Von der Finanzkrise zur Schuldenkrise

2011 ◽  
Vol 62 (1) ◽  
Author(s):  
Walter Wittmann
Keyword(s):  
Public Debt ◽  
Credit Rating ◽  
Debt Crisis ◽  
Foreign Debt ◽  
Subprime Crisis ◽  
The Public ◽  
Interbank Markets ◽  
Long Time ◽  
The Government ◽  
To Come

SummaryThis paper reviews the main developments leading to the actual financial and debt crisis. It starts with the expansionary monetary policy experiment in the US in 2002, which led to a bubble in stock markets and real estate markets. When the bubble burst, the latter provoked the subprime crisis. Banks holding subprime assets made substantial losses. Especially investment banks relying on refinancing in the capital market got in trouble. When Lehman Brothers failed the interbank markets collapsed and it was only due to the collective action of central banks and government that the financial system could be stabilized. The government involvement raised the public debt in many countries to unsustainable heights transforming the financial crisis into a public debt crisis. In Europe the weaker Euro member countries, burdened with both high public debt and high foreign debt, experienced steeply rising risk premia. In order to avoid a default of a member country as well as a default of their own banks, the stronger Euro countries made available guaranties, which will, in the longer run, diminish their own credit rating. The paper concludes with the skeptical note, that both the banking crisis and the public debt debt crisis may be with us for a long time to come.

The crisis in Greece and the EU-IMF rescue package: Determinants and pitfalls

2012 ◽  
Vol 62 (1) ◽  
pp. 15-39 ◽  
Author(s):  
Anna Visvizi
Keyword(s):  
Sovereign Debt ◽  
Debt Crisis ◽  
Free Market ◽  
Interesting Case ◽  
Sovereign Debt Crisis ◽  
Missed Opportunities ◽  
The Public ◽  
The Government ◽  
Free Market Reforms ◽  
The Eu

The sovereign debt crisis in Greece represents a very interesting case in which the Greek government succeeded in transforming domestic fiscal deficit problem, overspending and fear of free market reforms into a European challenge consistent with justifiable concerns about the sustainability of the euro-project and its likely future. In this paper, the roots of the crisis and the way of addressing it are discussed. In particular the features, drawbacks, missed opportunities and pitfalls of the €110 billion EU/IMF rescue package granted to Greece are examined. It is argued that the government’s focus on taxation rather than on politically costly privatization and cutbacks in the public sector undermined economic activity in the country, decreased the government’s revenue, and spawned disincentives for investment, without generating growth and without improving competitiveness. In brief, rather than contributing to economic recovery, the opposite was achieved as a result of the measures implemented by the government.

scholarly journals IMPACT OF THE GOVERNMENT DEBT ON ECONOMIC DEVELOPMENT OF COUNTRY

2019 ◽  
pp. 23-36
Author(s):  
Taras MARSHALOK ◽  
Ivanna MOROZ
Keyword(s):  
Economic Development ◽  
Public Debt ◽  
Positive Impact ◽  
Developed Countries ◽  
Research Process ◽  
The Public ◽  
Long Run ◽  
The World ◽  
The Government ◽  
The Eu

Introduction. An increase in public debt may have a negative, neutral or positive impact on the country's economic development. A big loan does not mean big growth; it all depends on how the public money is spent. The same amount of money spent by governments from dif­ferent countries has a different meaning for domestic development and the dynamics of public debt. The reasons are differences in the size of GDP, the structure of government borrowings, the shadow economy. Purpose. The objective of this paper is to deepen the theoretical backgrounds and applied aspects of influence of the public debt on the economic development of the country. Methods. In the research process, a set of research methods and approaches were used: systemic, structural-functional, comparisons and others. Results. The problem of a high level of public debt is acute in many countries throughout the world, including Ukraine. Nobody can say for sure whether a high public debt holds back the country's economic development. Theoretically, economically weaker countries, having regard to the financial constraints and economic needs, should have a higher level of public debt in relation to GDP than countries with high levels of development. However, comparing the data on the ratio of public debt and GDP in the EU, it can be noted the following: the higher indicators in the more developed countries of the EU. The latter, in fact, are the largest lenders of the world economy and at the same time have the largest volumes of the public debt both in absolute terms and in relation to GDP. As a result of the unsatisfactory financial state of the public sector, household saving goes to the repayment of the higher-level commitments, and not for the financing of the development of companies. This is especially problematic if we look at the situation of future generations – they will have less capital at their disposal. Public debt is a reduction in future revenues; hence, it is an intergenerational problem. Conclusions. It is possible to make proposals that will have a significant impact on the growth of the economy and the reduction of the public debt: – internal borrowing but not the external loans are economically justified. In this case, the debts do not increase the money base and the turnover of funds is carried out within the state; – entrepreneurship requires the systematic and consistent support that will stimulate the economic development, which needs stable business conditions in the long run.

scholarly journals Zmiany w sektorze finansów publicznych w dobie kryzysu gospodarczego w Unii Europejskiej

2014 ◽  
pp. 143-175
Author(s):  
Agnieszka Alińska ◽  
Katarzyna Wasiak
Keyword(s):  
Public Finance ◽  
Public Debt ◽  
Budget Deficit ◽  
Debt Crisis ◽  
Fiscal Rules ◽  
Legal Environment ◽  
The Public ◽  
Key Issues ◽  
Current Financial Crisis ◽  
The Eu

The paper concentrates on changes in the public finance sector in recent years: a topic of great importance from the viewpoint of maintaining stability of finan‑ cial system and from both national and EU perspective. The effects of the current financial crisis have stressed the need for action to reduce the growing deficit and public debt. Debt crisis shows that it is necessary to conduct an effective fiscal con‑ solidation to put and maintain economies of many countries on a path of sustain‑ able growth. The paper begins with a brief presentation of theory. In the following part, the paper discusses structural and cyclical causes of the rising debt. Changes in the legal environment, including key issues, were also discussed. Fiscal rules, fiscal councils and the fiscal pact were therefore analyzed in detail. The authors furthermore pay attention to certain limitations and weaknesses of fiscal policy, stressing the necessity to look at the economy from a broader perspective and to use other tools and instruments of state policy. The study includes recent data on GDP, the budget deficit, public debt and expenditure and revenue in the EU.

scholarly journals Аpplication of the EU experience of the financial systems’ transformation in the context of the debt crisis for Ukraine

2020 ◽  
Keyword(s):  
Correlation Analysis ◽  
Public Debt ◽  
Debt Crisis ◽  
Bank Loans ◽  
Financial Systems ◽  
Government Bonds ◽  
Eu Countries ◽  
Systems Transformation ◽  
The Eu

Transformation of financial systems is an extremely important process because the stability of the world economy depends on their adequacy, balance and efficiency. The financial systems of the EU countries have undergone a number of transformations, during which new mechanisms to strengthen economic governance were created. However, not all problems have been solved yet. The debt crisis has revealed existing weaknesses in the structure, thus provoking the need to strengthen the financial architecture by solving existing problems, while identifying and preventing possible future threats. The subject of research of the article is main directions of the transformation of the European financial system in the context of the debt crisis. The goal is to summarize the EU financial systems’ main directions of transformation in the context of the debt crisis and to identify the possibilities of their application for Ukraine. General scientific methods are used, such as system analysis which allowed to collect and systemize statistical data on EU countries and Ukraine for further analysis, correlation analysis and trend analysis, which allowed to determine the cumulative effect of unsecured bank loans and long-term government bonds yields of the EU countries and Ukraine on the level of their public debt. The following results were obtained: correlation analysis show the existence of correlation between unsecured bank loans and long-term government bonds yields of the EU countries and Ukraine with the level of their public debt. Conclusions: there are quite a lot of possibilities of application of the EU experience of the financial systems’ transformation for Ukraine. One of the basic is introduction of annual banks stress testing; further convergence of banking sector regulation to the requirements of Basel 3 and implementation of LCR; initiation of the process of creating a single mega regulator of the financial market.

Accountability in the Economic and Monetary Union

2020 ◽  
Author(s):  
Menelaos Markakis
Keyword(s):  
Monetary Policy ◽  
Monetary Union ◽  
Debt Crisis ◽  
Democratic Legitimacy ◽  
Economic And Monetary Union ◽  
Banking Union ◽  
Economic Governance ◽  
Member States ◽  
The Impact ◽  
The Eu

This book looks at accountability in the field of Economic and Monetary Union, including the Banking Union. It looks at the emergence of a new constitutional and governance architecture in the Eurozone, following the measures that were adopted in response to the crisis. It shows how the rules and institutions that were put in place in response to the financial and public debt crisis affect not only the economies of the Member States but also the lives of European citizens. It makes the case for instilling more democratic legitimacy into the Economic and Monetary Union and examines the impact of the new EU economic governance framework on the horizontal and vertical distribution of power in the EU and the Member States. The key question is: what is the appropriate level, type, and degree of accountability and transparency that should be involved in the development of the EU’s governance structures in the areas of fiscal/economic governance and the Banking Union? The book evaluates the powers conferred on the European and national parliaments in the fields of economic governance, monetary policy, and banking supervision/resolution, as well as the European Parliament’s input into the crisis-induced measures. It further looks at access to EU courts, the available remedies, and the role of the EU and national courts in reviewing economic and monetary policy measures. Finally, it sets out the author’s own proposals regarding the reforms needed to strengthen the Eurozone, as well as transparency, accountability, and—more broadly—legitimacy in the Economic and Monetary Union.

scholarly journals EСONOMIC AND MONETARY UNION: CORRECTION ОF FAILURES

2013 ◽  
pp. 113-118
Author(s):  
A. N. Tsibulina
Keyword(s):  
Monetary Union ◽  
Sovereign Debt ◽  
Debt Crisis ◽  
Adjustment Process ◽  
Sovereign Debt Crisis ◽  
The Public ◽  
Macroeconomic Indicators ◽  
Economic Imbalances ◽  
Optimum Currency ◽  
The Eu

The articles deals with the initial design failures of the European and Monetary Union which could have lead to the current sovereign debt crisis of some of its member-states. It touches upon issues such as the Theory of Optimum Currency Areas, economic imbalances and situation with the public finances within the EU. The EU makes efforts to implement new initiatives which could prevent the euro area from future crises while debates remain on the best possible options. These initiatives imply not only deepening of economic integration but also of a political one. Under these circumstances reaching a consensus in EU- 27 becomes quite a challenging process and different groupings of countries might appear and this can even more complicate decision-making and functioning of the EU. While the outcome of the reforms is still to be seen in the future, some macroeconomic indicators show that real adjustment process has started in the periphery countries due to urgent measures taken at the EU level. Nonetheless the latter ones have not yet generated what is necessary for a sustained way out of the crisis.

scholarly journals Italy and the Comprehensive Agreement on Investments: disappointment over the process

2021 ◽  
Author(s):  
Francesca Ghiretti
Keyword(s):  
Critical Points ◽  
Business Community ◽  
Member States ◽  
Positive Assessment ◽  
The Government ◽  
The Eu

AbstractThe formal conclusion of the Comprehensive Agreement on Investments (CAI) has drawn much criticism. Criticisms for member states did not always recognise the same critical points. The case of Italy presents an instance in which the issue rather than laying in the content of the agreement was identified in the process. Not only had Italy been marginalised in the process of negotiation that led to the conclusion of the CAI, but also exponents from the government claim that leading negotiators, amongst which France and Germany, ignored Italy’s doubts about the deal when these were raised. Beyond politics, the paper shows that the Italian business community displays a response to the agreement in line with that of the rest of the EU in its positive assessment of the outcome.

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