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Specific Aspects of Public Debt Management in Austria Overview Austrian Debt S. 2 Austria still with AAA-rating - 205 billion EUR total debt (72,3 % of GDP) in 2010 (184 billion EUR, 67,1 % of GDP in 2009) - financial debt 187 billion EUR in 2010 (178 in 2009) - interest 2010: 9,9 billion EUR (including SWAPS) - balance of current accounts 2010: surplus of 3,2 % of GDP (+ 2,3 % in 2009) Long-term sustainability threatened S. 3 But: first time since 1996 cashflow negative - federal government in 2009 cashflow negative with 5,3 billion EUR; in 2010 reduced to -3,1 billion EUR - first time since 1996 - meaning: just to support current expenses including interest payments Austria has to add new debt in such a year --> consolidation necessary Financial crisis S. 4 Expenses or revenues for the taxpayers ? -100 billion EUR rescue package (2008) - reduced to 65 billion EUR in 2010 and 15 billion in 2011 - 7,5 billion EUR preferred shares in banks (capital injections) - 22 billion EUR state guarantees --> still too early to know the total costs of the rescue package (even a small revenue is still possible) Total guarantees S. 5 +10,6 % due to financial crisis in 2009 • guarantees 2008: 113 billion EUR • guarantees 2009: 124 billion EUR +10,6 % in federal guarantees guarantees 2010: 129 billion EUR (+3,7 %) Debt composition S. 6 Austrian debt with low FX-risk - 97 % in EUR, 3 % in FX (2009) - aggregated maturity 4,8 years (2010) low FX-risk, low roll-over-risk Risk management S. 7 Luckily there was a steep learning curve of ÖBFA after a paradigmatic audit (see WGPD-homepage) in 2009: -introduction of new limit systems for ÖBFA (maximum liquidity, maximum cost of carry) - purchases of SIV‘s were generally banned - the minister of finance led an expert group which drafted new risk guidelines: - introduction of stress tests - new watchlist (CDS-Spreads of counterparties) European Stability Mechanism (ESM) S. 8 Austria participates in ESM - effective lending capacity of 500 billion EUR in discussion - Permanent stability mechanism after June 2013 (before EFSM/ European Financial Stabilisation Mechanism) - initial capital stock of „500 billion EUR plus buffer“ planned - smaller part paid-in shares, the rest in callable shares - discussions concerning auditing rights for NAOs and ECA S. 9 Thank you very much for your attention!