THE IMPACT OF THE INTRODUCTION OF THE EURO ON DEBT MANAGEMENT IN HUNGARY

摘要

Before trying to assess the impacts of the introduction of euro, I would like to draw attention to one specific aspect of Hungarian debt management. For the past 30 years, Hungary has been an active participant in the international capital markets, having issued more than 100 public bonds in 13 different markets, including those of the so-called legacy currencies (deutsche mark, Austrian schilling, Netherlands guilder, French franc, Luxembourg franc and Spanish peseta). Due to this active fund-raising from the international capital markets, Hungary has a relatively high share of foreign currency debt, which constitutes 36 per cent of the public debt portfolio. In line with the debt management strategy of the Government debt management agency the budget deficit, including interest payments on external debt and the maturing domestic debt, is exclusively financed by the domestic market. As only the maturing principal of the foreign currency debt is being rolled over in the international capital markets, the share of the foreign currency debt will gradually decrease. A more radical decrease of this part of our debt portfolio is not contemplated.