Public Debt Keeps Declining Due to Tight Borrowing Policy


2003 08 28


Vilnius, 28 August, 2003. The public debt, which began declining in the beginning of April 2003, sustains its declining trends. According to the data provided by the Ministry of Finance, in July the total public debt decreased by LTL 35.6 million as compared to the previous month and in end-July amounted to LTL 13,093.6 million, or accounted for 24.3% of the projected GDP.

The decline in the public debt was mainly caused by direct and contingent liabilities. In July, loans taken on behalf of the State (direct liabilities) fell by LTL 32.1 million, i.e. up to LTL 11,526.3, or made up 88% of the total public debt. Government guarantees on loans (contingent liabilities) decreased by LTL 3.5 million as compared to those in the previous month, and amounted to LTL 1,567.3 million, or accounted for 12% of the total debt on the 31st July 2003.

During July 2003, the government borrowing under the former loan agreements amounted to LTL 1.1 million, the repayment of credits to foreign creditors amounted to LTL 39.4 million, therefore, the total foreign debt decreased by LTL 39 million, and in end-July amounted to LTL 7,537 million, or made up 57.9% of the total public debt. The foreign debt decreased by LTL 0.7 million was caused by exchange rate fluctuations.

Only a slight increase in the direct domestic debt of LTL 6.9 million was observed. In end-July the direct domestic debt amounted to LTL 3,989.3 million, or accounted for 30.5% of the total public debt.  

In July the contingent foreign debt decreased by LTL 6.5 million and amounted to LTL 1,394.2 million, or accounted for 10.6% of the total public debt. Within the month debtors received LTL 23.2 million and repaid LTL 25.8 million of government guaranteed loans.

An inconsiderable rise in the contingent domestic debt by LTL 3 million was observed, and in end-month amounted to LTL 173.1 million, or made up 1.3% of the total debt.

The long-term debt (including government guarantees) comprised LTL 12,529.8 million, or 95.7 % of the total debt, while the short-term debt accounted for LTL 563.8 million, or 4.3 of the total debt.

On 31 July, the total foreign debt amounted to LTL 8,931.2 million, or accounted for 68.2% of the total public debt. Lithuania was indebted in foreign currency: to international development organisations (the World Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Nordic Investment Bank and other international organisations)- LTL 1,642.5 million, to foreign government institutions – LTL 439.8 million, to the International Monetary Fund – LTL 166.1 million, and to other creditors (commercial banks and financial institutions) – LTL 6,682.8 million.

In end-July, the total domestic debt amounted to LTL 4,162.4 million, or accounted for 31.8% of the total public debt. The government was indebted in Litas: to commercial banks – LTL 2,097.2 million, financial institutions and individuals – LTL 1,952.6 million, other public sectors – LTL 112.6 million.