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Assessing the sustainability of Maltese government debt

Author

Listed:
  • John Farrugia

    (Central Bank of Malta)

  • Owen, Grech

    (Central Bank of Malta)

Abstract

This study discusses the concept of fiscal sustainability and, by so doing, sheds light on government debt dynamics. It then presents a conventional debt sustainability analysis (DSA) exercise to gauge the sustainability of Maltese general government debt over the medium to long term. The exercise consists of two alternative scenarios which reveal how the government debt-to-GDP ratio might evolve over the next decade. For robustness, each scenario is subjected to a number of adverse shocks. The results suggest that Maltese government debt is sustainable, but this comes with important caveats.

Suggested Citation

  • John Farrugia & Owen, Grech, 2013. "Assessing the sustainability of Maltese government debt," CBM Working Papers WP/04/2013, Central Bank of Malta.
    • Handle: RePEc:mlt:wpaper:0413
    as

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    File URL: https://www.centralbankmalta.org/file.aspx?f=447
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    References listed on IDEAS

    as
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    Cited by:

    1. Ellul, Reuben, 2017. "Correlation between Maltese and euro area sovereign bond yields," MPRA Paper 80795, University Library of Munich, Germany.
    2. Ian Borg, "undated". "Fiscal Multipliers in Malta," CBM Working Papers WP/06/2014, Central Bank of Malta.

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    More about this item

    JEL classification:

    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt
    • H68 - Public Economics - - National Budget, Deficit, and Debt - - - Forecasts of Budgets, Deficits, and Debt

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