SOME ASPECTS OF STATE EXTERNAL DEBT
SOME ASPECTS OF STATE EXTERNAL DEBT

Summary/Abstract: After the collapse of the Soviet Union, foreign debt in the newly formed states is systematically rising. For example, the volume of the state debt of Georgia increased especially in 2003-2012: government sector - 2.8 times and the national bank - almost twice. In the same period of time, the total external debt volume increased by 4,7 times; in 2013-2016 the corresponding indicators were: 1.2, - 0.7 and 1.3. Especially in 2003-2012 external debts continued to grow in both public and private sectors (commercial banks, inter-companies loans ...). Most of the state external debts were spent on improving the infrastructure, and the real sector of the economy used minimal amounts. Through the similar approaches there are mainly created new seasonal jobs. Throughout the years, in Georgia the growth of the total debts, including the state foreign debts, was followed by the increase of percentage indicators of debts growth in GDP which exceeded the growth rates of the economy. Under such conditions, national economies have difficulty paying off debts. According to the study in 2016 the percentage share of the gross external debt in GNP is the highest in Ukraine, then in Georgia and in Moldova. By these indicators In 2012, Georgia was the "leader" country; paying off external debt is rather difficult in transformational economy: In order to cover the gross external debt, Georgia will have to pay more than $ 5 million in the next one year. More than $ 0.5 billion - to pay off debts received by state and state guarantees, which is more than 35% of the GDP in 2016; foreign debt is a rather heavy burden for the countries with transitional economies, but without it the successful implementation of economy is impossible, but it is important to increase the interest earned by the debt and to create new jobs on this basis.

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