External Public Debt

In order to understand what the external public debt is, it is first of all necessary to understand what is the national debt. So, under the state debt is understood the sum of debts on state loans. It arises in connection with the need to attract financial resources and meet the needs of the population. Almost all countries of the world have public debt. However, it occurs for various reasons. It can arise if the economic situation is not stable in the country, or it may just arise as an embedded factor of economic stabilization and development. The emergence of public debt can affect the recovery of the economy in the country and solve acute social problems.

There is a subdivision for domestic public debt, as well as external public debt. So, the internal state debt is a loan of money (resources) from the population, banks, corporations, and also other financial institutions. In fact, a nation's loan is made from itself. Along with the positive moments of the emergence of public debt (domestic), there are a number of negative ones. Repayment of debts is carried out at the expense of the budget (taxpayers). To reduce the state. Debt can increase taxes. The country's exit to the loan market increases competition in the money market, interest rates on money capital increase. This deprives the private sector of investment and inhibits the economic development of the state.

Creditors of domestic debt: banks, corporations, people, credit and financial institutions.

External public debt is external loans and other debt obligations to non-residents by creditors. It presupposes the export and transfer of part of the produced product outside the state. The presence of an external public debt is the norm. However, its increase could become dangerous and lead the state to depend on creditors, undermining public confidence.

In the world practice, the relative parameters of the external public debt (special indicators) are used. They include the ratio of payments on debt obligations to the export of goods (services).

Creditors of external debt are: states, international financial organizations , for example: the IMF; International Bank for Reconstruction and Development, etc.

The conversion of public debt is a combination of financial and legal mechanisms that are aimed at reducing the country's debt. At conversion external debt is replaced with other kinds of obligations. So, it is possible to repay the state. Debt with commodity deliveries, transfer of a debt to another state, mutual offset of financial claims, etc.

The public debt of the Russian Federation is obligations on Russia's debts to legal entities and individuals, foreign countries, international organizations, as well as other international actors. The guarantor of the state's solvency is the treasury and is provided for all property in the ownership.

Depending on the currency, there is a subdivision for the external public debt of the Russian Federation, as well as the internal public debt of the Russian Federation.

Internal state debt, expressed in rubles. The volume of debt includes:

- the principal (ie, nominal) amount of the RF debt on state securities;

- the amount of the principal debt on loans received by Russia;

- the amount of debt (principal) for budget loans (credits) received by Russia from budgets of other levels;

- The volume of obligations under Russian government guarantees.

External public debt, expressed in foreign currency. The volume of debt includes:

- the volume of obligations under Russian government guarantees;

- The volume of debt (principal) on loans received by Russia from foreign governments, credit organizations, as well as firms and international financial organizations.