Magister Commercii - MCom / 1. Taxes are an important source of government revenue (income). A failure by the government to collect sufficient taxes to cover for its ever increasing expenditures, engenders fiscal problems. Amongst others the government is compelled to borrow to finance its budget short fall. In this instance, should the government borrow domestically or offshore to finance its short fall . 2. Amongst the theories discussed in this paper, are the views of the Neoclassical Keynesian and the Ricardi an schools of thought. Further more, South African theories on government debt are also discussed. 3. There is a considerably large number of indicators that can be used to determine an appropriate level of both domestic and foreign debt of a country. Certain well establish criteria such as the ratio of foreign interest payments to exports, the ratio of foreign debt to gross domestic product, the ratio of·govemment debt to gross domestic product and the ratio of foreign debt to exports, are amongst the pool of indicators that can be used. However, the following indicators have been identified as the most commonly used in the analysis of budget deficits, and they are; ratio of deficit before borrowing and debt repayment to GDP, the ratio of government debt to GDP, the ratio of interest payments to government expenditure, the level of real interest rates relative to economic growth and the net asset value or net worth of the government. 4. Deficit financing refer to the ways in which the budgetary gap is financed. Overreliance on domestic borrowing may mean high real interest rates and falling investment, and overreliance on foreign borrowing can cause appreciating real exchange rates and unsustainable external indebtedness, amongst others. 5. Amongst the available remedies for debt ills in this country, is the suggestion to significantly cut government expenditure. However, realities currently confronting the authorities, like the increase in public servants as a result of the abolishment of homelands and the constitutionally guaranteed employment of civil servants from the old order, automatically put pressure on public consumption. 6. On the international front, South Africa is underborrowed. In this regard favour should go more for offshore borrowing. Certainly South Africa has to generate the means of meeting debt obligations by running a surplus of exports over imports of goods and services. The bulk of the country's debt is of domestic origin which account for well over 90 % of total debt. The current anti inflationary monetary policy with its concomitant high interest rates, makes domestic borrowing more costly.

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Magistro baigiamąjame darbe atlikta Baltijos šalių valstybės skolos ir jos valdymo lyginamoji analizė. Darbą sudaro trys dalys. Pirmoje darbo dalyje apžvelgiami teoriniai valstybės skolos ir jos valdymo aspektai: pateikiamas valstybės skolos klasifikavimas, skolinimosi instrumentai, veiksniai, leimiantys valstybės skolinimosi poreikį, valstybės skolos vertinimo rodikliai, apžvelgiama kokį poveikį šalies ekonomikai daro valstybės skolinimasis, taip pat valstybės skolos valdymo problemos bei kylančios rizikos. Antrojoje darbo dalyje pateikiama Baltjos šalių valstybės skolos analizės, vertinimo bei prognozavimo metodologija. Trečiojoje darbo dalyje atliekama Baltijos šalių ekonominės situacijos, lemiančios valstybės skolinimosi poreikį, analizė. Taip pat analizuojamas Baltijos šalių valstybės skolos dydis, jį lemiantys veiksniai, skolos struktūra, atliekamas valstybės skolos vertinimas pagal santykinius rodiklius bei apžvelgiami skolos valdymo ypatumai. Pritaikant koreliacinę analizę tiriamas Baltijos šalių valstybės skolos ir pasirinktų veiksnių ryšys. Panaudojant daugialypės tiesinės regresijos bei autoregresijos slankiųjų vidurkių metodus, prognozuojama Baltijos šalių valstybės skola 2013 - 2014 metams. Galiausiai pateikiamos išvados ir siūlymai. / The master thesis analyses and compares the government debt of Baltic states and its management. The work consists of three parts. The first part provides theoretical overview of government debt and its management: the classification of the government debt, borrowing instruments, factors, which influence state's borrowing needs, government debt indicators, the link between governmnet debt and economic growth, as well as problems of government debt management and emerging risks. The second part presents the methodology of government debt analysis, evaluation and forecasting. The third part primaliry analyzes economic situation in Baltic states. It also analyzes and compares changes in government debt of Baltic states, the reasons of changes, costs of borrowing, the debt structure, also evaluates government debt in Baltic states by using relative rates of government debt and reviews the main aspects of government debt management. The correlation analysis is used to investigate the relationship between government debt of Baltic states and some selected factors. By using multiple regression model and autoregressive – moving average method, there is forecasting the changes of government debt in Baltic states in period 2013 – 2014. Finally, conclusions are made and recommendations are given.

Diploma thesis describes the development and prospects of greek economy, mainly focused on Economic adjustment programme for Greece introduced in May 2010. Main chapter introduces the goals of the programme and design of main reforms. Estimates of further economic development and the possible restructuring of greek debt was presented.

This thesis investigates whether or not changes in a country’s government debt could affect its domestic stock market performance. The relationship is investigated by examining three different European countries, Germany, Portugal and Sweden, on the basis of two variables; (1) quarterly government debt changes as a percentage of gross domestic product and (2) the quarterly stock market changes over the time period2000:Q2 – 2011:Q2. The evidence is presented with help of Ordinary Least Square Method and Granger Causality test for each respective country. According to the Efficient Market Hypothesis, stock market prices should fully reflect all relevant information, e.g. government debt changes, as soon as they occur, without any delay, if the market is efficient. Past information should be insignificant and therefore not affect the stock market prices in an efficient market. In the cases of Sweden and Germany, the results proved to be ambiguous and thus do not allow for either rejection or acceptance of the Efficient Market Hypothesis with respect to government debt changes. However, some support was found in the case of Germany since the government debt changes and the stock market performance were instantaneously correlated. The empirical results presented in this thesis further allowed for the assumption that Portugal was not able to efficiently capture changes in the debt levels without any delay. This indicates that the Efficient Market Hypothesis can be rejected in regards for Portugal with respect to government debt changes. Furthermore, since the Portuguese stock market performance was not able to capture efficiently changes in the government debt level, it hence could possibly mislead the direction of the economy when looking into the stock prices to determine economic conditions. Moreover, the results imply that each country faces different relationships between the variables and that the relationships possibly could depend on the economic health of a country.

A main focus of this thesis is a relationship between government debt and rating of a respective country. The first chapter forms a theoretical basis and deals with a general characteristics of rating for all economic subjects, introduction of the three most important rating agencies and last but not least with government debt. The theoretical part is followed by a description of government debt's development and rating of the Czech Republic. An application part of the thesis conducts a basic analysis of relationship between government debt and rating and subsequently the core analysis using a specific framework from a rating agency.

Thesis advisor: Peter Ireland / Thesis advisor: Rosen Valchev / This dissertation consists in three chapters, each making a distinct contribution. Chapter 1 empirically tests classic and new Uncovered Interest Parity puzzle in an innovative way. Findings suggest that government debt is significant and economically relevant for UIP puzzles estimation.Chapter 2 shows that a class of macroeconomic models reproduce the UIP puzzle under a standard parametrization and adding convenience yields exogenous dynamics. Chapter 3 is a theoretical model that links financial crises to the election of populists parties, matching empirical evidence from Europe. / Thesis (PhD) — Boston College, 2021. / Submitted to: Boston College. Graduate School of Arts and Sciences. / Discipline: Economics.

While state-owned enterprises play an instrumental role in economic development, they are a significant fiscal risk to the state. This occurs through state-guaranteed loans that have more lax credit monitoring, and soft budget constraints, where stateowned enterprises can increase their debt levels without fear of liquidation or bankruptcy. This study empirically investigated the relationship between Eskom’s financial performance and its own debt and government debt, using the utility’s financial statements and government debt data from 1985 to 2017. The study used two models, namely, the Vector Autoregression (VAR) Model and the Error Correction Model (ECM) to analyse the data. In terms of the VAR, according to the impulse response functions, a one standard deviation shock to the debt-to-GDP ratio has a minimal impact on the electricity price, Eskom’s revenue and Eskom debt. Therefore, an innovation to the debt-toGDP ratio explains a large proportion of itself, as one standard deviation shock to the electricity price has a positive response from Eskom’s revenue and its debt. Similarly, a one standard deviation shock to Eskom’s revenue has a positive response from the electricity price and Eskom’s debt, and a one standard deviation shock to Eskom’s debt has a positive response from the electricity price and Eskom’s revenue. The forecast error variance decomposition analysis shows that up to 9,17% of the forecast error variance of the debt-to-GDP ratio is explained by the electricity price. Government debt relative to GDP explains 32,9% of the forecast error variance in the electricity price. The electricity price explains 29,51% of the forecast error variance in Eskom’s revenue. The forecast error variance for Eskom debt is explained by government debt/GDP which is up to 30,34%. The ECM shows that a long run relationship exists between Eskom’s debt relative to government debt, Eskom’s revenue relative to the electricity price and Eskom’s staff numbers. The study shows that Eskom’s increase in revenue is largely attributed to tariff hikes, stateguaranteed loans and equity injections, rather than increases in sales. A large proportion of government debt is comprised of Eskom debt. The proposed avenue as a way forward is partial privatisation or fiscal consolidation. / Economics

This diploma thesis deals with financing of central government deficit through the issue of government bonds and with overall context which is inextricably linked with this area. There is defined and discussed a basic terminology in terms of bond, budget system, budget deficit and public debt in the introductory theoretical chapters. We can find a description of development and management of central government debt in the Czech Republic in the next practical chapter of this diploma thesis. The gross borrowing requirements of the Czech Republic are largely covered by issue of government bonds and also by savings government bonds since 2011. The last chapter is devoted to the description of the process of a new euro-denominated issue of government bonds which is again shown on the example of the Czech Republic and its Ministry of Finance.

This thesis deals with the relationship between yield spreads on the sovereign bonds and their determinants with a primary focus on the Czech Republic. First, a homogeneous panel of Visegrad group countries (V4) was investigated by the pooled mean group (PMG) method of Pesaran et al. (1998). It was found that debt-to-gdp ratio along with VIX, the "fear gauge", are the main factors driving the spread dynamics in the V4 group. Based on the results from PMG estimation, we estimate a three-dimensional vector autoregression (VAR) model and structural VAR (SVAR) model in order to observe spread reactions on external shocks. Among the V4 group countries, Hungary exhibits the largest spread response to a VIX shock. Overall, the (S)VAR results confirmed that countries with higher levels of yields before crisis had also a stronger reaction to the market disturbances during 2007-2009. Furthermore, it was found that for the period 2010-2013, the standard model (macroeconomic fundamentals plus global risk aversion factors) provided less reliable results. As a remedy, financial soundness indicators were incorporated into the VAR model. We conclude that it is important to take into account country's financial sector vulnerabilities when describing the spread dynamics since 2010.