29th April 2022, Skopje – Public debt, as of 31st March 2022, accounted for 57.1%, decreasing by 3.7 percentage points compared to 31st December 2021, when it accounted for 60.8% of GDP. Repayment of liabilities on the basis of external debt principal influenced the public debt reduction in the first quarter in 2022, amounting to EUR 55.2 million. As per the latest data, public debt is positioned at a level below the EU Maastricht Criterion, thus demonstrating the well-set fiscal policy and the sound public finance management in times of energy crisis and increased inflation.
In order to protect general government debt portfolio against possible future market shocks, i.e. unfavorable changes of interest rates directly leading to increase of the costs to the Budget, maintaining optimal interest rate structure of general government debt portfolio is one of the objectives in the upcoming period. In line therewith, at the “100 Days Government” Forum held on Friday, Minister of Finance underlined that reducing the cost price is significant.
“Public debt has been reduced by 3.7 percentage points. This provides for creating room for additional financing, amounting to EUR 454 million throughout this year”, Minister Besimi pointed out.
He thereby added that the Budget Law adoption, currently undergoing parliamentary procedure, is of exceptional significance. Pursuant to the Law, the Budget and the Fiscal Strategy should be in line with the fiscal rules pertaining to the general government deficit and its total debt. Thereby, budget deficit for the respective year must not exceed 3% of the nominal GDP, while total debt must not exceed 60% of the nominal GDP.
In line with the revised Public Debt Management Strategy, public debt is expected to account for 63.5% of GDP at the end of this year. In the medium term, i.e. by 2026, according to the projections set in the Public Debt Management Strategy, public debt will stabilize and will be reduced to 56.5%, while government debt will be reduced to 50%.