The monetary package deployed by the European Central Bank (ECB) to help countries before the pandemic allows the paradox that the volume of Spanish debt climbs but the interests paid for it.
The government predicts that are reduced by 1,480 million euros with respect to the previous year “as a consequence of the decline in interest rates of new emissions, in line with the evolution of interest rates in the market.”
This is included in the draft general budgets of the state of 2022 that the Minister of Finance, María Jesús Montero, has delivered this Wednesday at the Congress of the Deputies.
According to the text, the financial expenses of the State represent 30,223 million euros and decrease by 4.7% compared to 2021;
97.5% of these expenses correspond to interest on public debt in euros, that is, almost 29,500 million euros.
The shopping program displayed since March 2020 by the ECB has facilitated all these months the financing and refinancing operations of the public treasury, lowering costs and lengthening the period of life of debt.
It is expected that 2021 will end with an average life of the State debt portfolio above 8 years, compared to 7.75 years 2020. For 2022, the portfolio’s half-life is expected to stabilize at that level or
Increase slightly, standing inside an 8 to 8.2 years fork, which yields some protection against an eventual rise in interest rates.
Regarding the average cost of Treasury emissions, in 2020 stood at 0.18% and at the end of August this year was at -0.03%, that is, investors are paying for Spanish debt.
“To the extent that the profitability of the emissions made by the Treasury during the year is less than that of the old references that are overcoming, it is expected that during 2021 and 2022 is continuing to reduce the average cost of currency debt
, which closed 2020 at 1.86% and is located at the end of August 2021 at 1.66%, “collects the document published today.
On the other hand, the Public Treasury provides for 9.8% by reducing its gross debt issues for 2022, up to 242,846 million euros, to meet the financing needs of public administrations and amortizations.
As figured in the draft general budgets of the State, most will be placed in bonds and obligations, 90% of the total, followed by farings from the Treasury, 6.2% of the total, and other debt instruments, the
3.8%
At the end of this year, the forecast is that letters represent 6.6% and bonds and obligations, 93.4%.
Net indebtedness in 2022 will amount to 80,000 million, which will be contributed solely by bonds and obligations, as well as other debts in euros and currencies, since the executive does not foresee that the letters that are issued next year contribute net funding.
Next year Spain will not complement its debt emissions with the Loans from the European Union (EU) of the Sure Program, aimed at helping unemployment caused by the pandemic, since it has received all the funds available from this European program in 2020
and 2021.
