Friday, October 1, 2010

Economics 1/10/10: External Debt

Yesterday, CSO published Q2 2010 data on our International Investment Position.

Here are some highlights:

"At 30 June 2010, the gross external debt of all resident sectors (i.e. general government, the monetary authority, financial and non-financial corporations and households) amounted to €1,737bn." So Irish total gross external debt rose €63bn qoq.

Our total foreign liabilities stood at €2,643bn and are offset by €2,500bn of foreign assets.

The liabilities also include €1,218bn of equity and derivative liabilities that do not form part of external debt.

Liabilities of the Monetary Authority (to ECB) that consist almost entirely of short term loans and deposits, amounted to €66bn, an increase of €28bn on Q1 2010, but down €38bn on Q2 2009.

General government foreign borrowing decreased by over €3bn to €80bn between end-March and end-June 2010.

The liabilities of other sectors (financial intermediaries and non-financial corporates) increased by €17bn from Q1 and at €657bn represented 38% of the total debt, a similar share to the
previous quarter.

Direct investment liabilities increased by €17bn to €262bn in Q2

Liabilities of monetary financial institutions (credit institutions and money market funds) consisting mostly of loans and debt securities were €672bn, an increase of over €5bn on Q1, but down €18bn on Q2 2009.

Few charts. Starting with levels of assets and liabilities:
Next, balance:
Notice declining surplus in Other Sectors.

Combining assets and liabilities:
Lastly, removing Government from the equation:
Clearly, a sign of expanding liabilities and rising assets, with net balance on the negative side slightly worse than in Q1.

Summarizing these in tables:

1 comment:

Anonymous said...

"...expanding liabilities and rising assets..."

Would I be correct in thinking that the inevitable dynamic of a bust period (and this one looks like it has a long way to run yet in terms of debt amelioration) is that asset values go down?

So, while our liabilities are rising, our assets might look alright on paper but in reality will be getting more and more difficult to sell for their 'book value' by the day?

Great post, than you Constantin. These are certainly the facts and figures that we need to be trying to deal with, and that we should be basing our planning, strategising and thinking upon.