Foreign Government Debt Research Articles

Analysis Of The Influence Of Inflation, Exchange Rate And Current Transaction Deficit On Government’s Foreign Debt

The goal of the study is to evaluate the impact of Indonesia’s government foreign debt on the country’s current account deficit, exchange rate, and inflation before and after the world financial crisis. Ordinary Least Squares (OLS) is the analytical technique used. According to regression analysis, the current account deficit, currency rate, inflation, and the global financial crisis account for 90% of the official foreign debt. The analysis’ findings indicate that the exchange rate and the current account deficit have a negative and considerable impact on the government’s foreign debt. The Indonesian government debt is strongly and favorably influenced by the inflation rate.

Accounting for Borrowing and Economic Performance in Nigeria

Accounting for public borrowing and economic performance has been under constant investigation. This study examined the impact of public borrowing on economic performance of Nigeria between 1981 to 2021. The study adopted purposive sampling technique and analyzed using robust ordinary least square (ROLS). The independent variables are, Federal government domestic debt (FDD), Federal government foreign debt (FGFD), cost of servicing debt (CSD), Federal government total expenditure (FGTE) is proxy for dependent variable while, Federal government retain revenue (FGRR) is proxy for control variable. The study reveals that that of FGRR, CSD, FGFD and FGDD have positive and significant influence on the federal government total expenditure. The study was theoretically anchored on Dual Gap Analysis Theory, Adam Smith Theory on Debt and The Ricardo Theory of Public Debt. The study then concludes that Nigeria’s total expenditure has risen astronomically through domestic debt, foreign debt, government retained earnings and debt servicing. The study then recommends very strong internal control should be enforced over utilization of borrowed fund, domestically or externally, as well as investigation of the internal control process of borrowing in Nigeria. Again, debt should be reduced so as to reduce the cost burden of servicing it as debt overhang is imminent in Nigeria. The study recommends the investigation of the internal control process of borrowing in Nigeria for further study.

Effect of Foreign Debt on Economic Growth in Indonesia

Economic development is very important for third world countries, including our country Indonesia, in reducing the distance behind the economy and social welfare from advanced industrial countries. Efforts to develop the economy in these countries which are generally initiated by the government are somewhat limited due to the lack of effective economic resources, the most important of which is capital resources, in particular, which often serve as catalysts for development. In order to meet the shortage of capital resources the government and the countries involved tried to bring in foreign capital through various types of loans. In the short term, foreign debt greatly assists the Indonesian government in its efforts to cover the deficit in the state revenue and expenditure budget. Because routine spending and development spending are quite a lot. So that it can accelerate economic growth faster according to the target. However, in the long term, it turns out that the government's foreign debt can cause various economic problems in Indonesia.

THE EFFECT OF GROSS DOMESTIC PRODUCT, EXPORTS, IMPORTS, EXCHANGE RATES, INFLATION AND EXTERNAL DEBT ON INDONESIA'S FOREIGN EXCHANGE RESERVES IN 2017-2020 (STUDY FROM AN ISLAMIC PERSPECTIVE)

Indonesia is a country that cannot be separated from international relations. In addition, it also has a major influence in the event iof fluctuations in the world economy caused by adopting an open economic system. By conducting international relations, of course, it can increase foreign exchange reserves which of course provide benefits for the country. Indonesia itself has little foreign exchange reserves available because it is used to pay off the government's foreign debt and high import costs. If a country makes foreign loans continuously, the amount of foreign exchange reserves will decrease, so that the economy becomes sluggish. The purpose of this study was to analyze the effect of gross domestic product, exports, imports, exchange rates, inflation and foreign debt on Indonesia's foreign exchange reserves. The sample in this study is 48 data from 2017-2020. This research method is a quantitative approach with data analysis using classical assumption test, multiple linear regression analysis, hypothesis testing and coefficient of determination test with data processing test equipment, namely SPSS version 16. The results show that partially (1) gross domestic product has a positive and positive effect. significant effect on Indonesia's foreign exchange reserves, (2) exports have a positive and significant effect on Indonesia's foreign exchange reserves, (3) imports have a negative and significant effect on Indonesia's foreign exchange reserves, (4) the exchange rate has a negative and significant effect on Indonesia's foreign exchange reserves, (5) inflation does not have a significant effect on Indonesia's foreign exchange reserves, (6) foreign debt has a positive and significant effect on Indonesia's foreign exchange reserves, (7) simultaneously gross domestic product, exports, imports, exchange rates, inflation and foreign debt have a positive and significant effect on Indonesia’s foreign exchange reserves

A New Viterbi-Based Decoding Strategy for Market Risk Tracking: an Application to the Tunisian Foreign Debt Portfolio During 2010–2012

In this paper, a novel market risk tracking and prediction strategy is introduced. Our approach takes volatility clustering into account and allows for the possibility of regime shifts in the intra-portfolio's latent correlation structure. The proposed specification combines hidden Markov models (HMM) with latent factor models that takes into account the presence of both the conditional skewness and leverage effects in stock returns. A computationally efficient expectation-maximization (EM) algorithm based on the Viterbi decoder is developed to estimate the model parameters. Using daily exchange rate data of the Tunisian dinar versus the currencies of the main Tunisian government's creditors, during the 2011 revolution period, the model parameters are estimated. Then, the suitable model is used in conjunction with a Monte Carlo simulation strategy to predict the Value-at-Risk (VaR) of the Tunisian government's foreign debt portfolio. The backtesting results indicate that the new approach appears to give a good fit to the data and can improve the VaR predictions, particularly during financial instability periods.

Modelling and Forecasting Foreign Debt Using ARIMA Model: The Zambian Case from 2022 to 2035

The study sought to model and forecast Zambian Government foreign debt from 2022 to 2035 using Autoregressive Integrated Moving Average Model. The secondary data of time series during the period of 1973 to 2021 on Zambia’s foreign debt are used as the basis of forecasting for the next 15 years by using ARIMA (Autogressive Integrated Moving Average) Model. The ARIMA (1, 1, 2) model was used due to its accuracy, mathematical soundness, and flexibility, thanks to the inclusion of AR and MA terms over a regression analysis. The results showed that ARIMA (1, 1, 2) is an adequate model which best fits foreign debt time series datadue to the smaller deviations in the mean absolute percentage error and mean square error and its errors are smaller than Moving Average (MA), Generalized Autoregressive Conditional Heteroskedasticity Model (GARCH), Simple Exponential Smoothing (SES), Error, Trend and seasonal model (ETS), Double Exponential Smoothing (DES), Seasonal Autoregressive Integrated Moving Average (SARIMA), Vector Autoregressive Model (VAR), Vector Error Correction Model (VECM), Threshold Autoregressive model (TAR), Triple Exponential Smoothing (TES), hybrid ARIMA, and Artificial Neural Network Model (ANN). The results show that the value of the Zambia’s foreign debt is predicted to keep increasing from 2022 to 2035 amounted to USD 80.5862 billion. The results also show that compared to government debt in 1973, within 49 years, Zambia’s foreign debt is predicted to rise by 209.34%.

Analisis Pengaruh Utang Luar Negeri Pemerintah terhadap Pertumbuhan Ekonomi Indonesia (Periode 1980-2019)

This study aims to analyze the effect of government foreign debt on economic growth in the period 1980-2019 in the long and short term by using time series data analysis using the Error Correction Model (ECM). Other independent variables analyzed are investment and Labor Force Participation Rate (TPAK). The results show that the government's foreign debt has a positive and significant impact on economic growth. The value of the elasticity coefficient of economic growth to the government's foreign debt is 4.86 in the long term and 2.47 in the short term. The investment variable and LFPR also show a positive and significant effect in the long and short term, except for the investment variable which has no significant effect in the short term. The ECT coefficient in the short term produced is -0.360222 indicating the speed of adjustment of economic growth towards equilibrium is 36.02% per year

Dynamic Forecasting of Government Foreign Debt: Case of Indonesia

This study aims to forecast the value of the Indonesian government foreign debt in 2020-2024. The secondary data of time series during the period of 2010-2019 on Indonesian government foreign debt are used as the basis of forecasting for the next five years by using ARIMA (Autogressive Integrated Moving Average). The results show that the selected ARIMA models for forecasting are ARIMA (3,1,3) after the unit root test is carried out and 16 ARIMA models are tested. The value of government foreign debt is predicted to keep increasing from 2020 to 2024 amounted to USD 253.01. Then, compared to government debt in January 2010, within 11 years, government foreign debt is predicted to rise by 169.6%.

C. PENGARUH UTANG LUAR NEGERI DAN EKSPOR TERHADAP PERTUMBUHAN EKONOMI (Studi pada Produk Domestik Bruto Indonesia Periode 2015-2019)

ABSTRACT
 The purpose of this research is to analyze the influence of exports and foreign debt which can affect Indonesia's GDP (Gross Domesty Product). The variables of this research are the foreign debt value of the Indonesian government and the value of Indonesian exports as the independent variable, and the value of Indonesia's GDP as the dependent variable. The data used are supporting data for the 2015-2019 period from the time series (time series) of Bank Indonesia and BPS. The data analysis method used multiple linear regression analysis. The results of this study are the value of the Indonesian government's foreign debt and the value of Indonesia's exports have a significant effect. Meanwhile, the results of the partial test (t-test) show that the value of foreign debt and exports of the Indonesian government greatly affects the value of Indonesia's GDP.
 Keywords : External Debt, Export, Economic Growth
 (Menggunakan template jurnal sinta 2 JESP (Jurnal Ekonomi dan Studi Pembangunan) eISSSN : 2502-7115 l pISSN : 2502-7115 Universitas Negeri Malang).

Revenue and Distributional Impact Analysis of Indonesian Personal Income Tax Reform in 2008

Since 1983, Indonesian tax policy has been the subject of ongoing reforms in order to replace the old colonial tax arrangements, reduce income dependency from oil and gas, decrease the government's foreign debt and maintain its fiscal sustainability. Nevertheless, after 25 years of reform, actual Indonesian tax performance is still far from what might have been expected as Indonesia have one of the lowest total tax ratios among the ASEAN countries. This research show that the most recent changes put in place may have reduced potential tax revenue from personal income but an increase in the compliance rate.

“High & Dry”: The Liquidity and Credit of Colonial and Foreign Government Debt and the London Stock Exchange (1880–1910)

We gather a new database to conduct the first historically informed study of the importance of liquidity and credit for government bonds between 1880 and 1910. We argue that colonial and sovereign debt markets were segmented owing to differences in underlying information asymmetries. The result was heterogeneous pricing of colonial and sovereign debt, and different market microstructures and clienteles, themselves influenced by political, institutional, and financial arrangements. We find that sovereign spreads mainly reflected credit risks, while colonial spreads mainly reflected liquidity risks. Liquidity premia were economically large and significant, contributing between 10 percent and 39 percent of colonial spreads. These findings help understanding why the seemingly dry subject of colonial illiquidity inspired passionate disputes and ground-breaking reforms of financial imperial institutions.

UTANG LUAR NEGERI (ULN) PEMERINTAH RI: BERMANFAAT ATAU MENYENGSARAKAN?

This article tries to explain the impact of Indonesian government foreign debt on its economic condition. The debt, on one hand, especially one through the government course is badly hoped to return Indonesian economic condition to be better after crisis. On the other hand, however the government foreign debt accumulation becomes the boomerang for Indonesian government. How far is actually the permissiveness of the foreign loan can be clarified via some approaches i.e. budget principle, net transfer. and Debt Service Ratio (DSR) approaches. The visible phenomenon based on the above approaches illustrates that Indonesian government foreign debt condition is hugely accumulated, so it is regarded to exceed the repayment power.

'High and Dry': the Liquidity and Credit of Colonial and Foreign Government Debt in the London Stock Exchange (1880-1910)

We gather the most comprehensive database of government bonds for the first globalisation era to date to conduct the first historically informed study of the importance of liquidity for colonial and sovereign yield spreads. Considering both liquidity and credit shows that the two markets were segmented: credit was the most important factor in the pricing of sovereign debt, but liquidity predominated in the colonial market, explaining 10% to 39% of colonial yield spreads. This reflected both different market microstructures and bond clienteles, themselves influenced by heterogeneous political, institutional and financial arrangements. The flows from the colonies to British ‘ordinary’ investors in the form of illiquidity premia should be taken into account in future studies of the political economy of empire.

From foreign trade to international investment: a new step in China’s integration with the world economy

China’s economic strategy is facing new challenges arising from the changes in the world economy as well as in its domestic conditions. Given the sluggish global economy and the rise of protectionist policies, China cannot expect external demand to contribute to its economic growth as much as in the past. On the domestic side, the working age population has ceased to increase and will soon diminish; rising domestic costs will force Chinese exporters to shift from price competitiveness to quality upgrading and to build new comparative advantages. An important dimension of China’s new strategy will be the expansion of its direct investment abroad. China which has already become the leading world exporter and has been up to now a major recipient of foreign direct investment is likely to turn out to be a major international investor. China has accumulated large foreign assets which mainly consist of foreign government debt securities and is now aiming at diversifying its external assets through promoting Chinese firms’ investment abroad.

Bondholders versus bond-sellers? Investment banks and conditionality lending in the London market for foreign government debt, 1815-1913

This paper offers a theory of conditionality lending in nineteenth-century international capital markets. We argue that ownership of reputation signals by prestigious banks rendered them able and willing to monitor government borrowing. Monitoring was a source of rent, and it led bankers to support countries facing liquidity crises in a manner similar to modern descriptions of “relationship” lending to corporate clients by “parent” banks. Prestigious bankers' ability to implement conditionality loans and monitor countries' financial policies also enabled them to deal with solvency. We find that, compared with prestigious bankers, bondholders' committees had neither the tools nor the prestige required for effectively dealing with defaulters. Hence such committees were far less important than previous research has claimed.

To Err is Human: Rating Agencies and the Interwar Foreign Government Debt Crisis

During the 1930s, rating agencies took up a central role in regulatory supervision that they still have today. The proximate cause for this changeover was the economic shock of the Great Depression. Exploring the performance of rating agencies in assessing the risks of sovereign debt, an important segment of the bond market, we do not find that superior forecasting capacities can explain the agencies' growing importance.

To err is human: US rating agencies and the interwar foreign government debt crisis

This article provides a new perspective on the interwar foreign debt crisis by analysing original data on the credit ratings, market yields and subsequent performance of government borrowers in the New York market. We focus on the four agencies that are known to have been operating at the time (Fitch, Moody's, Poor's and Standard Statistics). We provide a description of the rise of the market for grades and gather information on the products sold, price schedules, etc. We find that rating agencies did exhibit features similar to those that have attracted considerable interest recently: namely, they did not react until the crisis had already begun and then implemented massive downgrades. We conclude by suggesting that, given the less than stellar record of the agencies, their emergence in the 1930s as a regulatory tool will have to be explained in future research.

Hamlet Without the Prince of Denmark: Relationship Banking and Conditionality Lending in the London Market for Foreign Government Debt, 1815-1913

This paper offers a theory of conditionality lending in 19th century international capital markets. We argue that ownership of reputation signals by prestigious banks rendered them able and willing to monitor government borrowing. Monitoring was a source of rent, and it led bankers to support countries facing liquidity crises in a manner similar to modern descriptions of “relationship” lending to corporate clients by “parent” banks. Prestigious bankers’ ability to implement conditionality loans and monitor countries’ financial policies also enabled them to deal with solvency. We find that, compared with prestigious bankers, bondholders’ committees had neither the tools nor the prestige required for effectively dealing with defaulters. Hence such committees were far less important than previous research has claimed.

To Err is Human: US Rating Agencies and the Interwar Foreign Government Debt Crisis

To Err is Human: US Rating Agencies and the Interwar Foreign Government Debt Crisis

The End of Gatekeeping: Underwriters and the Quality of Sovereign Bond Markets, 1815–2007

We provide a comparison of salient organizational features of primary markets for foreign government debt over the very long run. We focus on output, quality control, information provision, competition, pricing, charging and signaling. We find that the market set up experienced a radical transformation in the recent period and interpret this as resulting from the rise of liability insurance provided by rating agencies. Underwriters have given up their former role as gatekeepers of liquidity and certification agencies to become aggressive competitors in a new speculative grade market.