It is difficult to find a country that, conducting economic transformations, does not resort to external sources of financing. Properly used foreign loans and loans accelerate economic development, solve some of the socio-economic problems.
The concept of public debt
Each country has a certain level of spending, and when it is not possible to cover them with its own resources, a budget deficit arises . In this regard, there is a need to attract additional funds, which together and make up public debt. It refers to all types of debt obligations of the Russian Federation that arose several years ago or just before certain lenders. This also includes obligations to provide the Russian Federation with state guarantees denominated in the country's currency (rubles). Public debt service is manifested in the payment of all principal amounts of debt and interest on it. In simple terms, public debt is the amount that the state owes with all of its creditor.
State internal and external debt
Currently, there are several classifications of public debt. One of them distinguishes state internal and external debt.
The state domestic debt of the Russian Federation is that part of the debt that relates to domestic loans and other debt obligations to resident creditors. Such a debt is considered as a loan to the population itself. However, it does not affect the total size of the total wealth of the nation. It should be noted that domestic public debt is more likely a rule in the economy than an exception. Its existence is quite normal, except in cases where its amount becomes very high. More specifically, the state domestic debt of the Russian Federation consists of the following: the nominal amount on securities of the Russian Federation, the volume of the main debt on loans received by the Russian Federation, the volume of the main debt on budget loans and loans received by the state from budgets of other levels, as well as from the volume of obligations of the Russian Federation on state obligations provided by itself.
The state external debt of Russia is that part of the state debt that relates to foreign loans and other obligations of the Russian Federation to non-resident creditors. External debt includes obligations of the Government of the Russian Federation, expressed in foreign currency. The fact that Russia has an external debt is also a completely normal phenomenon, and not only for it, but also for any other country. True, there are borders beyond which state external debt becomes quite dangerous. A large number of external loans can lead to the country becoming dependent on lenders. The International Bank for Reconstruction and Development classifies external debt as follows: its low level should be less than 18% in relation to the export of goods and services, moderate - 18-30%. Accordingly, higher indicators are threatening to the development of the economy and the state as a whole.
State internal and external debt is a characteristic of the effectiveness of all credit operations that have been committed by the state. Its dynamics, absolute magnitude and rate of change reflect the state of the economy and financial system, as well as how efficiently the state structure functions.
Thus, state internal and external debt is a normal phenomenon for the modern development of the Russian Federation. It is simply necessary in the event that there is not enough own funds for the development of new industries or when it is necessary to withdraw the economy of their difficult situation as soon as possible.