The Palestinian Government’s overall public debt until the end of October 2015 reached $2.499.2 billion, increasing from $2.235.9 billion in September.

Hasnaa Al Rantisy – Palestine Economy Portal

Translated by: Tamara Barakat

The financial statement issued by the Ministry of Finance on Tuesday reveals that the Palestinian government’s overall public debt until the end of October 2015 reached $2.499.2 billion, increasing from $2.235.9 billion in last September.

In October 2014, the overall public debt was $2.282.2 billion. It increased in October 2015 by $0.217 million.

The overall public debt includes the sum of the short-term and long-term local debts, the external debt to Arab, international, and regional organizations, and bilateral loans.

The Government’s local debt due to banks operating in Palestine and public organizations reached $1.431.8 billion, increasing from $1.165.3 billion in September.

In October 2014, on the other hand, the Government’s due local debt was around $1.184.3 billion, which means that it increased in October 2015 by $0.2475 million.

As for the short-term local debt, it increased by $168.1 million in comparison with that of September. In September, it was $602.6 million, and it reached $770.7 million in October 2015.

The long-term local debt witnessed an increase by $98.5 million. In September, it amounted to $562.7 million and it reached $661.2 million in October.

Bank loans also increased by $120.4 million. They rose from $694.5 million in September to $814.9 million in October.

As for the external debt, it amounted to $1.067 billion until the end of October.

It is worth mentioning that short-term loans result from lack of or poor time coordination between the collection of public revenue and the disbursement of public expenditures during the fiscal year, resulting in a temporary deficit in the budget. Consequently, the country tries to cover this deficit through short-term loans borrowed from banks. This temporary loan may turn into a medium- or long-term loan if the country is unable to pay its obligations in due time.

Long-term loans are those borrowed for a period exceeding ten years. A country resorts to such loans to cover a deficit that cannot be covered during the fiscal year. This deficit usually results from investment projects necessary for economic development or from an increase in the country’s security expenses.

(Palestine Economy Portal)