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Lithuania has redeemed 1 billion Eurobond

Date

2012 05 10

Rating
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Vilnius, 10 May. Today Lithuania redeemed the Eurobond and reduced its debt by EUR 1 billion. The Eurobond was issued in 2002 and re-opened in 2006.

That was the largest Eurobond redemption in the history of Lithuania and it has also opened a new page in the Government borrowing need’s structure. During the 2009-2011, the bulk of borrowing requirement was related to fiscal deficit financing, while two thirds of the borrowing requirement for 2012 are related to redemption of the previous debts. A similar structure to this year’s is foreseen also for the nearest future.

In the Convergence Programme of Lithuania of 2012 the Government set the target of the sustainable public finances in 2015. After the implementation of this task the Public debt would decline to 35 % of GDP and the preconditions for the reduction of the Public debt in nominal terms would be laid. The estimated Public debt at the end of 2012 is expected to amount to 40.2 % of GPD.

Next year Lithuania will redeem another Eurobond EUR 1 billion in value, which was issued in 2003 and re-opened in 2004. If market conditions were favourable, the Government would pre-fund for the redemption of Eurobond even this year.

 

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