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The aggregate public debt is already at 40.2% of GDP
Posted On 26 Apr 2017
The total public debt stood at 40.2% of the Gross Domestic Product (GDP) at the end of March 2017, according to information available on the website of the Ministry of Finance.
The aggregate debt amounted to 40 465 million dollars in March, which takes into account the Government’s commitments with other public agencies. The Ministry of Finance stopped publishing this balance in its Public Debt Official Bulletin. However, the figure can be obtained by adding up the figures of the internal and external debt the agency has continued to submit in its monthly reports.
As a rule of fiscal prudence, the Planning and Public Finance Code establishes that State indebtedness should not represent more than 40% of the GDP. However, according to the Government, to calculate this ceiling, only the so-called consolidated debt should be taken into account, which excludes the State’s obligations with other agencies such as the National Financial Corporation (CFN) or the Ecuadorian Institute of Social Security (IESS) from the calculation.
The issue was thus defined through Decree 1218, issued in October 2016 by President Rafael Correa. It was pointed out that the debt burden on the GDP “is based on the Consolidated States (…), according to the Manual of Statistics of Public Finances of the International Monetary Fund.” Therefore, public debt represents 27.3% of the GDP, which means that the government is far from reaching the legal limit and still has a large margin of indebtedness.
Source: http://www.elcomercio.
