INNOVATIVE APPROACHES FOR THE EVALUATION AND FORECASTING OF DEBT LEVELS OF THE SECURITY IN UKRAINE

Abstract

Abstract. Improving the methodology for estimating and forecasting the level of debt security of the country in the medium and long term is of paramount importance for an adequate response to destabilizing factors. Increasing the degree of openness of the national economy, the existing problems of the internal development of the country’s economy, significant changes in the global economic space and adjusting the methodological approaches to integrated assessments and forecasting the level of debt security in Ukraine are all of particular relevance. World practice has shown that countries with higher public debt are more vulnerable to changing financial conditions that can actually endanger the economy and contribute to increasing the depth and duration of a recession, given the government’s inability to provide sufficient budget to support the economy. The purpose of this study is to develop innovative approaches to assess and forecast the level of Ukraine’s debt security in order to adequately respond to existing destabilizing factors. The use of a methodical approach to estimate and forecast the level of debt security in Ukraine is substantiated. The following indicators are proposed for application in the process of debt security assessment: external debt to annual exports; the ratio of the total amount of external debt servicing payments to the state budget revenue (which is currently considered as an indicator of the state of budgetary security); the ratio of the cost of external debt servicing to annual exports and GDP; the ratio of international reserves to short-term public debt; the share of short-term public debt in its total volume. The state of debt security in Ukraine in 2009—2017 was estimated and a forecast was made for 2018—2020. Modern estimation mechanisms of the state of debt security were studied, their deficiencies were outlined and directions of improvement were proposed. It is shown that the overwhelming majority of Ukraine’s debt security indicators are in the critical and unsatisfactory and, moreover, tend to further deterioration. The methodical approach to the estimation and forecasting of the level of debt security of Ukraine, which represents the gradual implementation of the estimation and forecasting of debt security of the state, is highlighted and a list of the most optimal methods for application at each of the stages is grounded. Keywords: debt security of the state, state debt, debt guaranteed by the state, assessment of the level of debt security of the state, gross external debt, official international reserves. JEL Classification F34; H63; C60 Formulas: 4; fig.: 4; tabl.: 3; bibl.: 17.

Keywords

• debt security of the state
• state debt
• debt guaranteed by the state
• assessment of the level of debt security of the state
• gross external debt
• official international reserves