28.05.2011

Central government net financing and financing requirement in 2011


On Monday, May 30, Budget Outlook 1 and Economic Survey, May 2011 will be available at www.fm.dk.

The financing requirement was introduced as a new concept in December 2010, replacing the borrowing requirement. The difference between the two concepts is that changes in the central-government account will not affect the financing requirement while they affected the borrowing requirement.

Thereby a clearer separation of financing requirement and financing strategy is achieved.

The estimates of the central government net financing and financing requirement in 2011 are presented in Table 1 below. The central-government financing requirement is expected to be DKK 149bn in 2011. This represents an improvement of DKK 3bn in 2011 compared to the December 2010 outlook.

The financing strategy is announced in the biannual notification of government debt policy published by Danmarks Nationalbank in June and December. The financing requirement can be met through borrowing or by drawing on the central government account. The notifications can be found on the website of the government debt management office, www.governmentdebt.dk.


Table 1. Net financing requirement and central-government financing requirement

DKK bn.

2011

Net financing requirement

45

Repayment of long term debt etc.1)

74

Repayment of short term debt2)

30

Financing requirement

149

- domestic financing requirement

112

- foreign financing requirement

37

1) Incl. payments from the central government in currency and interest swaps and net bond purchase of state owned funds.

2) Incl. the outstanding amount of Treasury bills and commercial papers in the beginning of the year.

Source: Budget Outlook 1, May 2011.

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