The coronavirus is pushing the Spanish economy to a limit, with a drop in GDP still difficult to gauge, millions of people at risk of losing their jobs and hundreds of thousands of companies on the brink of bankruptcy. The Government needs resources to continue financing the million-dollar bill of the pandemic on its coffers and, given this scenario, the Public Treasury has announced that it will increase the net debt issue for this year to 130,000 million , compared to the 32,500 million expected at the beginning. The exercise.

In other words, the agency will multiply by four the figures it managed for 2020 and will raise the total debt placement for this year to 297,657 million euros, thus covering the gross financing needs of these twelve months. With this increase, the net issuance to be made by the Treasury will be the highest in history, exceeding the figures for 2009, and the gross figure is also placed at historical levels.

The agency recognizes that the health crisis is having "important economic consequences" for our country and that the increase in expenses by the State, together with the fall in income as a result of economic activity, have made it necessary to "update the needs of Treasury financing. "

A part of this new debt will correspond to the habitual emissions that the agency carries out, but another part will come through "alternative sources of financing", as recognized by the Ministry of Economy. Among them, they admit that the Sure (the new instrument of the European Commission to support the ERTE) will have a fundamental role and that the Executive of Pedro Sánchez will resort to it to the full extent that Spain is allowed. "We have to issue an amount yet to be defined," they assure from the Department of Economic Affairs.

The current pandemic has forced to rethink the entire financing strategy of the Public Treasury. In fact, during the last two months it has accelerated the pace of its emissions to finance 143,491 million euros of its needs in the market, 48.6% of the new target set for 2020.

Despite the rapid and forceful intervention of the ECB to relieve pressure on the sovereign debt of the euro countries, the tensions experienced by financial markets in recent weeks have raised the average cost of new issues to 0.31 % so far this year, while the average cost of debt in

circulation stands at 2.02%. The average life of the State Debt portfolio is currently 7.74 years.

The annual interest burden of all Public Administrations has decreased by almost 7,000 million euros since 2013, from 35,405 million to 28,450 million euros at the end of 2019.

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