Debt Management Instruments
The primary goal of debt management is financing the Government’s borrowing needs at the lowest possible cost and an acceptable level of risk.
Managing the risk of the debt liabilities undertaken by the Government on behalf of the State and the monetary resources of the State, involve the management of exchange rate, interest rate, credit, liquidity (refinancing), and operational risks.
The Government’s net borrowing limit is set by the Seimas when it approves the Law on the Approval of the Financial Indicators of the State Budget and Municipal Budgets for each year. Limits (on the structure of the debt portfolio) for the debt liabilities that the Government undertakes on behalf of the State are set in the Stability Programme of Lithuania for 2019.
Limits for year 2019 set by the Parliament of the Republic of Lithuania
| Net change in Government debt liabilities | EUR 2,648.187 mill. |
| Liabilities assumed by guarantee institutions, which are granted a State guarantee (excluding the amount re-guaranteed by the AAA rated institutions) | EUR 327.42 mill. |
Limits for year 2019 set by the Government of the Republic of Lithuania
| The ratio of short-term debt (by residual maturity) to the total debt liabilities | no more than 25 % |
| The weighted average residual maturity of Central Government debt | more than 4 years |
| The weighted average residual maturity of Central Government debt till re-fixing | more than 3.5 years |
| The ratio of debt with a floating interest rate of the total debt liabilities | no more than than 10 % |
| Debt in Euros, after financial derivatives | 100 % |
| Government-guaranteed debt | no more than 3 % of GDP |
| Liabilities of the Agricultural Loan Guarantee Fund | no more than EUR 179.02 mill. |
| Liabilities of INVEGA (excluding the amount re-guaranteed by the EIF) | no more than EUR 148.4 mill. |
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