May 17, 2021

The Government will reduce debt issues for this year due to a lower need for financing


The Secretary General of the Public Treasury, Carlos San Basilio, has confirmed this Monday that in the coming weeks they will modify the objective of net issuance of Spanish debt downwards for this year due to the lower financing needs.

The Government has already reduced the net issuance of public debt planned for 2019 to 30,000 million euros, compared to the 35,000 million initially estimated, thanks to the good evolution of tax revenues, budget execution and savings obtained in the management of the Treasury.

At the same time, it cut by the same amount the gross emission planned for this year, standing at 204,526 million euros, 4% lower to that of last year.

The acting Minister of Economy and Business, Nadia Calviño, already advanced that the Executive would decide in autumn if you have "margin" to reduce the emission further Net expected debt.

Now, the Secretary General of the Treasury, in statements to RNE, has confirmed that the forecast of 30,000 million «Will be reduced in the coming weeks», which will allow the total issuance of the Treasury to be placed below 200,000 million «for the first time since 2012».

San Basilio has stressed that the Spanish economy presents lower financing needs every year, so emissions will be reduced. He also pointed out that, although financing costs are currently at "historical lows," there is still "downward margin."

Japan, a market interested in Spanish debt

The Secretary General of the Treasury has shown "very satisfied" with the decision of the Japanese credit rating agency R&I to raise the solvency note of the Spanish sovereign debt, from 'A-' to 'A' with a stable outlook.

The Secretary General of the Treasury has stressed that this decision of the Japanese agency help Spain in an interesting market like the Japanese, where there is a "growing interest" in Spanish debt.

Likewise, San Basilio has considered that it is positive news to the extent that it can help other rating agencies with the greatest impact in Europe, such as Moody's, Fitch and Standard and Poor's «go the same way», Which would have a" more significant "effect on financing costs.

Averaging all the emissions made this year, the financing costs are currently in the 0.37%, below the 0.6% minimum reached previously and that it was thought to be "unbeatable," admitted St. Basil.

The Secretary General of the Treasury has assured that, if agencies such as Moody's, Fitch and Standard and Poor's They will make a decision similar to the one taken by the Japanese rating agency, Spain would charge for the ten-year debt.

St. Basil has further stressed that reduce this year public debt to 95.8% of GDP It is an “absolute priority” for the Government and has added that the cost of financing that the State pays for its public debt will end 2019 “slightly above 2% of GDP”, compared to 2014, when it exceeded 3% .


Source link