Public debt, state financing, bond issuance, treasury bills, COVID-19, Ukraine war, fiscal policy, debt sustainability, OAT, BTF, financial markets
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Abstract
The state's financing needs and public debt management through bond issuance and treasury bills, impacted by crises like COVID-19 and the Ukraine war.
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[...] Financing the economy - How the State finances its financing needs ? - Overall, in France, for the past 50 years, the 'State' agent has had financing needs. - Overall, the French state is financed essentially by the issuance of bonds and treasury bills. - In 2021, the state's debt-to-GDP ratio is 92%. Chapter 1 : The state finances itself by issuing bonds on the financial market. Resources and Expenditures over a year In general, by aggregating the resources and expenditures of a country's state over a year. [...]
[...] Chapter 2 Has the financing of the state economy been modified by recent crises? Effects of the COVID crisis: In France, we lost 7.9% of GDP in 2020, which led to the unprecedented deterioration of the public deficit. Loss of 9.2% of GDP, therefore a loan of 271 billion (partial unemployment, PGE (State-Guaranteed Loans), exemption and deferral of social contributions: deficit of the Social Security) and stimulus plan. Therefore, public debt of 115% of GDP. Les Échos 11.2020: 'France: Higher financing through debt than through tax'. [...]
[...] - Direct finance: by issuing shares: impossible in any country. By issuing two types of Bonds: - OAT: Treasury Assimilable Bonds (medium/long term). - BTF: Fixed Rate Government Bond (short term). Procedure for issuing OAT by auction: - Auction: public tender, highest bidder: sale of the right to sell to the state - Dutch auction with multiple and sealed prices: AFT: announcement of the amount to be borrowed: the first Thursday of the month, must be SVT. SVT: sealed envelope with price proposal for new OAT. [...]
