Commission staff working document accompanying the Report from the Commission to the budgetary authority on guarantees covered by the general budget - Situation at 30 June 2009 COM(2010)188
Date: 2010-04-30
Institutions: European Commission
Subjects: Community loan, EU Member State, European Investment Bank, budgetary reserve (EU), general budget (EU), investment protection, macroeconomics, microeconomics, report, third country

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EUROPEAN COMMISSION 

Brussels, 30.4.2010 
SEC(2010) 479 final 

COMMISSION STAFF WORKING DOCUMENT 

accompanying the 

REPORT FROM THE COMMISSION 

to the budgetary authority on guarantees covered by the general budget  
situation at 30 June 2009 

COM(2010)188  

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TABLE OF CONTENTS 

1. 

Explanatory notes on the situation of risks covered by the Budget ............................. 3 

1.1. 

Tables A1 and A2......................................................................................................... 3 

1.1.1.  Authorised ceiling (Table A1) ..................................................................................... 3 

1.1.2.  Capital outstanding (Table A1).................................................................................... 4 

1.1.3.  Annual risk (Table A2) ................................................................................................ 4 

1.2. 

1.3. 

Loan operations covered by the Budget guarantee ...................................................... 7 

Evolution of risk......................................................................................................... 11 

1.3.1.  Situation of loans to Member States .......................................................................... 11 

1.3.2.  Situations of loans to third countries.......................................................................... 12 

1.4. 

Payment under the Budget guarantees ....................................................................... 14 

1.4.1.  Borrowing/lending operations.................................................................................... 14 

1.4.2.  Guarantees given to third parties................................................................................ 15 

1.4.3.  Activation of Budget guarantees................................................................................ 15 

2. 

Country-risk evaluation.............................................................................................. 16 

2.1. 

Candidate countries.................................................................................................... 17 

2.1.1.  Turkey ........................................................................................................................ 17 

2.2. 

Potential candidate countries...................................................................................... 18 

2.2.1.  Serbia.......................................................................................................................... 18 

2.3. 

New Independent States............................................................................................. 19 

2.3.1.  Georgia....................................................................................................................... 19 

2.4. 

Mediterranean partners............................................................................................... 21 

2.4.1. 

Jordan ......................................................................................................................... 21 

2.4.2.  Egypt .......................................................................................................................... 22 

2.4.3.  Lebanon...................................................................................................................... 23 

2.4.4.  Tunisia........................................................................................................................ 25 

2.4.5.  Morocco ..................................................................................................................... 27 

2.5. 

Other countries ........................................................................................................... 28 

2.5.1.  South Africa ............................................................................................................... 28 

2.5.2.  Mexico........................................................................................................................ 30 

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1. 

EXPLANATORY NOTES ON THE SITUATION OF RISKS COVERED BY THE BUDGET 

1.1. 

Tables A1 and A2 

The  purpose  of  Tables  A1  and  A2  is  to  show  the  outstanding  amount  and  annual  repayments  of 
capital and interest in respect of borrowing and lending operations for which the risk is covered by 
the Budget. The figures show the maximum possible risk for the EU in respect of these operations 
and must not be read as meaning that these amounts will actually be drawn from the Fund or the 
Budget. 

In these tables, figures related to “New Member States” refer to the Member States which acceded 
to the European Union on 1 May 2004 and on 1 January 2007. 

1.1.1.  Authorised ceiling (Table A1) 

This is the aggregate of the maximum amounts of capital authorised  (ceilings) for each operation 
decided by the Council or by the Council and the European Parliament. 

In order to relate it to the risk which the Budget might have to cover, account should be taken of the 
following factors which could affect it: 

Factor increasing the risk: 

•  the interest on the loans must be added to the authorised ceiling. 

Factors reducing the risk: 

•  limitation of the guarantee given to the EIB1: 

75%  of  the  total  amounts  of  loans  signed  in  the  Mediterranean  countries  based  on  the 
Mediterranean protocols of 1977 and Council Regulations 1762/92/EEC and 1763/92/EEC. 

70%  of  the  total  amounts  of  loans  signed  as  part  of  lending  operations  with  certain  non-Member 
States  authorised  by  Council  Decisions  96/723/EC,  97/256/EC,  98/348/EC  and  98/729/EC  and  a 
sharing of risk between the EU and the EIB as the Budget guarantee covers only political risks in 
some cases; 

65% of the total amounts of loans signed as part of financing operations with certain non-Member 
States authorised by Council Decisions 99/786/EC, 2000/24/EC and Decision 2009/633/EC of the 
Council  and  the  European  Parliament,  and  a  sharing  of  risk  between  the  EU  and  the  EIB  as  the 
Budget  guarantee  covers  only  political  risks  in  some  cases,  as  regards  the  two  first-mentioned 
decisions, and only risks of a political or sovereign nature in the case of the latter decision; 

•  operations  already  repaid,  since  the  amounts  concerned  are  the  maximum  amounts  of  capital 

authorised (ceilings) and not outstanding amounts; 

•  the ceilings are not necessarily taken up in full. 

1 

Within each portfolio individual EIB loans are, de facto, guaranteed at 100% until the global ceiling is reached. 

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Another factor to be considered is that some loans are disbursed in currencies other than the EUR. 
Due to exchange rate fluctuations, the ceiling may be exceeded when the amounts disbursed up to 
the date of the report are converted into EUR. 

1.1.2.  Capital outstanding (Table A1) 

This is the amount of capital still to be repaid on a given date in respect of operations disbursed. 

Compared with the previous aggregate, the amount outstanding does not include loans which have 
not yet been disbursed or the proportion of disbursed loans which have already been repaid. 

1.1.3.  Annual risk (Table A2) 

Estimated  amount  of  principal  and  interest  due  each  financial  year  by  each  country  according  to 
disbursements made until 30 June 20092. 

2 

For  the  purpose  of  this  calculation,  it  is  assumed  that  defaulting  loans  are  not  accelerated,  i.e.  only  due 
payments are taken into account. 

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TABLE A1: CAPITAL OUTSTANDING IN RESPECT OF OPERATIONS DISBURSED at 30.06.2009 (in EUR million)

Operations

MEMBER STATES
EIB (new Member States)
MFA to Bulgaria and Romania
Euratom to Bulgaria and Romania

BoP1
Hungary
Latvia

MEMBER STATES - TOTAL
THIRD COUNTRIES
A. Macro-Financial Assistance
Albania
Bosnia-Herzegovina
FYROM
Georgia
Lebanon
Serbia and Montenegro
Tajikistan
Ukraine
Sub total MFA
B. EURATOM2
C. Other
EIB Pre-Accession countries
EIB Neighbourhood and Partnership countries
EIB Asia and Latin America
EIB South Africa

Sub total EIB3
THIRD COUNTRIES - TOTAL
GRAND TOTAL

Authorised
ceiling

Capital
outstanding at
31.12.2008

Capital
outstanding at
30.06.2009

Remainder
to be disbursed
at 30.06.2009

3 921
140
433

2 000

6 494

9
40
85
58

280
28
15
 514
 53

5 372
5 777
1 731
 599

17 401
14 047
20 541

3 659
115
431

4 000
1 000

9 205

9
40
82
58
25
280
28
15
 536
 50

5 487
5 930
1 659
 583

17 318
14 245
23 450

6 500
3 100

9
40
90
142
50
280
75
453
1 139

28 755
28 342
8 205
2 400

67 702
68 841
68 841

 766

2 500
2 100

5 366

 25

 50
 9

5 440
4 604
1 311
 497

12 618
11 911
17 276

(1) By Decision 431/2008/EC of 18 May 2009 the Council decided to increase the ceiling from EUR 25 000 million to EUR 50 000 million.

(2) The overall ceiling is EUR 4 000 million for loans to Member States and to certain non-member States. 

(3) The subtotal EIB includes the EIB loans to Member States.

ANNEX TO TABLE A1: SITUATION IN RESPECT OF EIB OPERATIONS at 30.06.2009 (in EUR million)

Operations 

Mandate 2007/2013:
Pre-Accession countries
Neighbourhood and Partnership countries:

Mediterranean
Eastern Europe, Southern Coucasus and Russia

Asia and Latin America:

Asia
Latin America

South Africa

Previous General Mandate 2000/20075:
Pre-Accession countries
Neighbourhood and Partnership countries
Asia and Latin America
South Africa
Member States (following the accession)

sub-total 65 %3

Financial agreements (70% Guarantee rate)
Pre-Accession countries
Neighbourhood and Partnership countries
Asia and Latin America:
South Africa
Member States (following the accession)

sub-total 70 %3

Financial agreements (75% Guarantee rate)
Pre-Accession countries
Neighbourhood and Partnership countries
Member States (following the accession)

sub-total 75 %3

Financial agreements (100% Guarantee rate)
Pre-Accession countries
Neighbourhood and Partnership countries
Asia and Latin America
South Africa
Member States (following the accession)

sub-total 100 %3
Total  

Credit line
authorised

Loans made
available minus
cancellations

Amounts
disbursed

Amounts
outstanding 
at 30.06.2009

25 800
8 700
12 400
8 700
3 700
3 800
1 000
2 800
 900

20 060
10 235
6 520
2 480
825

45 860
7 477
3 770
2 310
1 022
 375

7 477
7 712
1 350
6 362

7 712
6 653
4 700
 750
 903
 300

6 653
67 702

8 611
3 621
3 163
2 861
 303
1 504
 369
1 135
 323

19 510
7 372
6 416
2 135
824
2 763
28 121
6 513
 477
1 617
 809
 375
3 236
6 513
7 062
 713
4 492
1 857
7 062
5 320
 29
 315
 710
 285
3 982
5 320
47 016

1 189
 381
 468
 468
 0
 318

 318
 22

14 049
5 187
4 607
1 653
523
2 080
15 238
5 962
 431
1 495
 661
 266
3 110
5 962
7 178
 720
4 499
1 959
7 178
5 138
 29
 86
 716
 204
4 104
5 138
33 516

1 187
 381
 468
 468
 0
 316

 316
 22

11 585
4 693
3 915
1 043
 435
1 499
12 772
2 754
 296
 695
 170
 114
1 479
2 754
 955
 109
 772
 75
 955
 837
 8
 80
 130
 12
 607
 837
17 318

(3) Percentage figures relate to the Guarantee rate.
(4) Loans to New Member States were drawn from 'Pre-Accession countries' or from 'Neighbourhood and Partnership countries' ceilings. Bulgaria and Romania are 
included in the "New Member States".

(5) Including Turkey Terra and Special Action Turkey.

5 

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Table A2: Total Annual Risk borne by the Budget in EUR million based on the amounts (capital and interest) due under all operations 

(MFA, BoP, Euratom and EIB) disbursed at 30.06.2009

Ranking

Country

2nd 2009

2010

2011

2012

2013

2014

2015

2015 until 2038 Total Outstanding

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57

Turkey
Romania
Hungary
Egypt
Morocco
Tunisia
Bulgaria
Lebanon
South Africa
Czech Republic
Poland
Serbia
Slovak Republic
Georgia
Jordan
Mexico
Brazil
Syria
The former Yugoslav Republic of Macedonia
Bosnia and Herzegovina
Croatia
Slovenia
Indonesia
Argentina
Albania
Ukraine
the Philippines
Pakistan
Vietnam
Cyprus
China
Israel
Peru
Latvia
Thailand
Algeria
Lithuania
Russia
Sri Lanka
Bangladesh
The West Bank and the Gaza Strip
Costa Rica
India
Malaysia
El Salvador
Maldives
Uruguay
Tadjikistan
Panama
Colombia
Montenegro
Estonia
Ecuador
Malta
Paraguay
Republic of Moldova
Laos
Total outstanding
Member States

 156.5
 152.4
 122.5
 92.7
 70.5
 69.0
 68.3
 58.1
 43.9
 42.3
 41.7
 34.2
 30.5
 24.2
 22.9
 22.0
 21.9
 19.2
 19.1
 17.7
 15.4
 12.4
 9.4
 8.8
 7.4
 7.4
 6.5
 6.1
 5.6
 4.8
 4.3
 4.1
 4.1
 3.6
 3.5
 3.5
 3.2
 2.6
 2.5
 2.4
 2.1
 1.8
 1.6
 1.5
 1.3
 1.3
 1.1
 1.0
 0.9
 0.8
 0.8
 0.5
 0.4
 0.3
 0.1
 0.1
 0.0
1 262.8
482.7

 312.6
 253.3
 196.4
 196.4
 145.2
 141.2
 85.2
 69.2
 74.5
 82.0
 80.0
 58.3
 65.5
 22.4
 41.2
 23.2
 62.8
 44.9
 24.7
 32.0
 31.1
 20.8
 18.6
 14.4
 14.3
 6.1
 12.7
 11.9
 14.3
 9.7
 8.3
 9.1
 10.1
 60.2
 4.9
 6.8
 5.7
 4.8
 3.2
 4.8
 4.1
 3.6
 3.2
 3.0
 2.1
 2.9
 2.0
 0.3
 2.4
 4.1
 1.6
 1.0
 2.0
 0.7
 0.0
 0.1
 0.0
2 316.0
860.5

 319.7
 290.3
2 209.1
 191.2
 152.1
 139.9
 69.8
 70.9
 61.2
 73.2
 77.5
 65.3
 66.0
 13.6
 39.5
 3.3
 47.7
 45.5
 24.5
 34.0
 39.7
 14.3
 14.8
 14.4
 14.3
 6.1
 12.5
 11.9
 14.7
 9.3
 7.6
 10.6
 17.5
 75.4
 4.5
 6.6
 5.5
 4.8
 4.8
 4.8
 4.1
 3.6
 3.2
 1.8
 2.0
 4.4
 2.5
 0.3
 2.4
 9.7
 2.4
 1.0
 4.0
 0.7
 3.5
 0.1
 0.2
4 334.4
2892.3

 352.9
 259.3
 141.8
 184.1
 155.4
 141.3
 82.6
 71.0
 75.3
 70.7
 75.0
 108.2
 51.0
 0.0
 37.6
 3.3
 42.0
 46.1
 26.3
 57.4
 42.7
 11.4
 12.9
 11.3
 15.8
 6.0
 12.7
 11.9
 14.8
 7.2
 6.9
 10.4
 18.4
 73.9
 6.2
 5.9
 5.3
 7.3
 7.7
 4.8
 4.1
 3.6
 3.2
 1.8
 0.9
 5.2
 2.8
 12.2
 2.4
 9.7
 3.1
 0.5
 4.0
 0.7
 7.1
 0.1
 0.4
2 336.8
779.5

 349.4
 258.6
 133.0
 176.9
 157.6
 144.6
 68.1
 65.8
 48.3
 68.1
 69.3
 107.6
 37.2
 0.0
 31.2
 3.3
 70.0
 44.3
 23.0
 30.2
 42.8
 9.4
 12.9
 11.2
 13.7
 5.9
 13.0
 9.0
 14.6
 4.7
 7.0
 10.6
 18.3
 73.8
 8.4
 5.2
 5.1
 7.3
 10.4
 4.7
 4.1
 3.6
 3.2
 0.9
 1.4
 5.2
 3.3
 12.1
 2.4
 9.7
 3.5
 0.0
 4.0
 0.3
 7.1
 0.2
 0.5
2 235.9
727.7

 362.2
 239.4
2 128.4
 157.5
 151.5
 140.4
 68.7
 48.1
 50.4
 56.4
 52.9
 114.5
 25.8
 0.0
 25.3
 3.3
 93.3
 44.3
 25.0
 28.9
 39.4
 7.4
 12.9
 3.8
 16.2
 5.9
 13.1
 6.1
 14.4
 3.1
 7.1
 10.8
 14.8
1 073.7
 2.0
 2.2
 5.0
 7.3
 13.5
 0.0
 4.1
 0.0
 0.0
 0.0
 1.2
 5.2
 3.7
 4.0
 2.4
 9.7
 3.4
 0.0
 4.0
 0.0
 7.1
 0.4
 0.5
5 120.9
3660.9

 349.1
 238.6
 63.0
 157.2
 135.8
 135.4
 65.4
 41.9
 44.5
 45.7
 42.9
 164.5
 15.1
 0.0
 17.7
 3.3
 201.7
 42.1
 23.5
 69.9
 38.5
 4.4
 12.9
 3.8
 16.6
 5.8
 10.8
 6.1
 6.8
 0.0
 7.2
 9.1
 14.8
1 242.3
 0.0
 0.0
 4.8
 7.3
 13.9
 0.0
 4.1
 0.0
 0.0
 0.0
 1.2
 5.2
 2.9
 0.0
 2.4
 9.7
 3.3
 0.0
 4.0
 0.0
 7.1
 0.5
 0.6
3 303.3
1722.1

2 669.0
2 596.4
1 560.9
 973.5
1 047.0
 858.0
 287.6
 119.6
 225.5
 130.0
 142.1
 570.0
 116.1
 0.0
 70.5
 13.1
 14.4
 263.2
 82.4
 152.5
 301.8
 2.1
 31.2
 0.0
 124.2
 14.1
 21.9
 13.2
 12.5
 0.0
 21.7
 115.4
 30.2
 13.9
 0.0
 0.0
 17.9
 35.7
 57.2
 0.0
 10.1
 0.0
 0.0
 0.0
 5.1
 17.3
 4.3
 0.0
 19.3
 36.7
 34.9
 0.0
 14.1
 0.0
 3.5
 3.3
 34.9
12 887.7
4866.9

4 871.3
4 288.4
6 555.1
2 129.3
2 014.9
1 769.9
 795.7
 544.6
 623.6
 568.5
 581.5
1 222.3
 407.2
 60.2
 286.0
 74.6
 553.6
 549.5
 248.6
 422.7
 551.4
 82.3
 125.5
 67.7
 222.5
 57.3
 103.0
 76.1
 97.7
 38.9
 70.0
 180.1
 128.2
2 616.8
 29.6
 30.1
 52.4
 76.9
 113.3
 21.5
 36.8
 16.2
 14.4
 9.0
 15.2
 46.8
 22.7
 30.0
 34.8
 90.2
 53.0
 3.0
 36.6
 2.6
 35.5
 4.8
 37.0
33 797.7
15992.5

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1.2. 

Loan operations covered by the Budget guarantee  

Tables A3a, A3b(1), A3b(2) and A4 

TABLE A3a
Borrowing and lending operations by the Communities to Member States 

Period 31.12.2008 to 30.06.2009

Instrument

Decision

Date of
decision

Loan Guarantee Maturity
term
(years)

Rate

Date

Loan
situation

Amount
decided

 - closed (a)
 - partially disbursed (b)
 - disbursed in full (c)
 - not yet disbursed (d)

Outstanding
Outstanding
amount
amount
at 31.12.2008
at 30.06.2009
in EUR million in EUR million

BOP

2002/332/EC

18.02.02

100%

Hungary

2009/102/EC

1st tranche
2nd tranche

04.11.08
9/12/2008
26/03/2009

Latvia

2009/290/EC

20.01.09

77/270-271/Euratom
80/29/Euratom
82/170/Euratom
85/537/Euratom
90/212/Euratom

29.03.77
20.12.79
15.03.82
05.12.85
23.04.90

1st tranche

EURATOM

Bulgaria
     1st tranche
     2nd tranche
     3rd tranche
     4th tranche
     5th tranche
     6th tranche
     7th tranche
     8th tranche
Romania
     1st tranche
     2nd tranche
     3rd tranche

TOTAL

3
5.6

5.1

20
15
17
15
15
16
16
14

17
19
18

100%

09.12.2011
07.11.2014

03.04.2014

10.05.2021
15.01.2017
19.08.2019
18.06.2018
16.01.2019
10.09.2020
04.04.2021
23.02.2020

21.07.2022
26.11.2024
23.02.2024

(b)

(b)
(c)
(c)

(b)
(c)

(c)
(c)
(c)
(c)
(b)

(c)
(c)
(c)
(c)
(c)
(c)
(c)
(c)

(c)
(c)
(c)

50 000.00

2 000.00

5 000.00

6 500.00

2 000.00
2 000.00

4 000.00
2 000.00
2 000.00

1 000.00
1 000.00

3 100.00

4 000.00
 500.00
 500.00
1 000.00
1 000.00
1 000.00
 212.50

 223.50

 432.50

 430.50

 40.00
 12.75
 25.00
 23.75
 35.00
 30.00
 25.00
 17.50

 100.00
 90.00
 33.50

 40.00
 12.00
 25.00
 22.50
 35.00
 30.00
 25.00
 17.50

 100.00
 90.00
 33.50

54 000.00

2 432.50

5 430.50

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   COUNTRY

TABLE A3b (1)
 European Union (MFA) and Euratom loans to non-member States*
Changes in amounts outstanding during six-month period 31.12.2008 to 30.06.2009, broken down by countries and tranche
* Member States as of 01.01.2007
Loan
situation

Date
of decision

Amount
decided

Expiry
date

Decision

Amount
outstanding
at 31.12.2008

Loan
term
(years)

    BULGARIA IV*
     1st tranche
     2nd tranche
    ROMANIA IV*
     1st tranche
     2nd tranche
     3rd tranche
    BOSNIA AND HERZEGOVINA I
     1st tranche
     2nd tranche
    BOSNIA AND HERZEGOVINA II
     1st tranche
     2nd tranche
    FYROM I
     1st tranche
     2nd tranche
    FYROM II
     1st tranche
     2nd tranche
     3rd tranche
     4th tranche

99/731/EC

08.11.99

99/732/EC

08.11.99

99/325/EC

10.05.99

02/883/EC

09.11.02

97/471/EC

22.07.97

99/733/EC

08.11.99

10
-

10
10
 -

15
-

15
15

15
15

15
15
15
15

21.12.2009
-

29.06.2010
17.07.2013
 -

22.12.2014
-

16.01.2019
09.02.2021

27.09.2012
13.02.2013

15.01.2016
30.01.2017
04.06.2018
23.12.2018

EN 

 - closed (a)
 - partially disbursed (b)
 - disbursed in full (c)
 - not yet disbursed (d)

(c)
(c)

(c)
(c)
(a)

(c)
(c)

(c)
(c)

(c)
(c)

(c)
(c)
(c)
(c)

8 

in EUR million 

Operations in 
six-month period

Amounts
disbursed

Amounts
repaid

25.00

3.00

100.00
40.00
60.00
200.00  
100.00
50.00
50.00
20.00
10.00
10.00
20.00
10.00
10.00
40.00
25.00
15.00
50.00
10.00
12.00
10.00
18.00

10.00
30.00

50.00
50.00

10.00
10.00

10.00
10.00

20.00
15.00

10.00
12.00
10.00
18.00

Amount
outstanding
at 30.06.2009

10.00
30.00

25.00
50.00

10.00
10.00

10.00
10.00

20.00
12.00

10.00
12.00
10.00
18.00

EN 

 
  
 
 
TABLE A3b (2)
 European Union (MFA) and Euratom loans to non-member States
Changes in amounts outstanding during six-month period 31.12.2008 to 30.06.2009, broken down by countries and tranche

   COUNTRY

Decision

Date
of decision

Loan
term
(years)

Expiry
date

Loan
situation

Amount
decided

 - closed (a)
 - partially disbursed (b)
 - disbursed in full (c)
 - not yet disbursed (d)

in EUR million

Amount
outstanding
at 31.12.2008

Operations in 
six-month period

Amounts
disbursed

Amounts
repaid

Amount
outstanding
at 30.06.2009

  UKRAINE III
     1st tranche

  UKRAINE IV
  GEORGIA
  ARMENIA
  TAJIKISTAN
     1st tranche
SERBIA AND MONTENEGRO
SERBIA AND MONTENEGRO
     1st tranche
     2nd tranche
     3rd tranche
ALBANIA
LEBANON

98/592/EC

15.10.98

2002/639/EC
97/787/EC
97/787/EC
2000/244/EC

12.07.02
17.11.97
17.11.97
20.03.00

2001/549/EC
2002/882/EC

16.07.01
09.11.02

2004/580/EC
2007/860/EC

29.04.04
21.12.07

10
-

15
15

15
15

15
15
15
15

30.07.2009
-

24.07.2013
30.12.2013

30.03.2016
17.10.2016

28.02.2018
01.09.2018
04.05.2020
23.03.2021
04.06.2014

UKRAINE (Euratom)

94/179/EC

21.03.94

11

15.03.2018

TOTAL

EN 

(c)
(a)
(d)
(c)
(a)
(b)
(c)
(c)

(c)
(c)
(c)
(c)
(b)

(b)

9 

150.00
58.00
92.00
110.00
110.00
28.00
75.00
60.00
225.00
55.00
10.00
30.00
15.00
9.00
50.00

EUR equivalent 
of USD 83 million

14.50

57.50
0.00

28.00
225.00

10.00
30.00
15.00
9.00

52.90

14.50

57.50
0.00

28.00
225.00

10.00
30.00
15.00
9.00
25.00

50.13

25.00

2.77

706.90

25.00

30.77

701.13

EN 

 
  
 
 
TABLE A4

LOAN GUARANTEES TO EIB

in EUR million 

Geographical Area

Decision

Date
of decision

Rate
of guarantee

MED. Financial protocols(1)

MED. Horizontal cooperation

1762/92/EEC

TOTAL MED. (3)

C and E Europe I

C and E Europe II

Asia, Latin America I

Asia, Latin America Interim

Asia, Latin America Interim

South Africa

New mandates

FYROM

Bosnia and Herzegovina

Turkey Terra

Mandates 2000-2007

The Baltic Sea basin of Russia

Russia, Belarus, Rep. Of Moldova and 
Ukraine

90/62/EEC(4)

91/252/EEC(5)

93/696/EC(6)

93/115/EEC

96/723/EC

96/723/EC

95/207/EC

97/256/EC(7)

98/348/EC

98/729/CE

99/786/EC

2000/24/EC(8)

2001/777/EC(9)

8.03.77

29.06.92

12.02.90

14.05.91

13.12.93

15.02.93

12.12.96

12.12.96

01.06.95

14.04.97

19.05.98

14.12.98

29.11.99

22.12.99

06.11.01

75% (2)

75% (2)

100%

100%

100%

100%

100%

70%

100%

70%

70%

70%

65%

65%

100%

100%

Date of
guarantee
contract
30.10.78/10.11.78

09.11.92/18.11.92

24.04.90/14.05.90

19.01.93/04.02.93

22.07.94/12.08.94

04.11.93/17.11.93

18.03.97/26.03.97

21.10.97

04.10.95/16.10.95

25.07.97/29.07.97

29.07.98/07.08.98

16.06.99/22.06.99

18.04.00/23.05.00

Amount
decided

Loans signed

Amount outstanding

        (minus cancellations)

at 31.12.08

at 30.06.09

at 31.12.08

at 30.06.09

6 062

1 800

7 862

1 000

 700

3 000

 750

 153

 122

 300

7 105

 150

 100

 600

5 548

1 656

7 204

 912

 493

2 464

 571

 139

 122

 285

6 142

 150

 100

 600

5 548

1 656

7 204

 912

 493

2 464

 571

 139

 122

 285

6 142

 150

 100

 600

 608

 441

1 049

 120

 9

 618

 136

 5

 11

 41

2 730

 117

 57

 524

 615

 340

 955

 102

 5

 507

 125

 5

 9

 12

2 578

 112

 55

 526

2005/48/EC(10)

22.12.04

19.07.00/24.07.00 (11)

06.05.02/07.05.02

19 460

 100

19 002

 85

18 910

 85

21.12.05/09.12.05

 500

 230

 230

Mandate 2007-2013

2006/1016/EC(12)

19.12.06

65%

01.08.07/29.08.07 (13)

TOTAL

27 800

69 702

5 943

44 441

8 611

47 018

(1) Including EUR 1 500 million for Spain, Greece and Portugal.
(2) General guarantee of 75% for all credits made available under lending operations under a guarantee contract signed between the Community and the EIB on 30.10.78 and 10.11.78.
       By way of exception, a 100% guarantee applies to the emergency aid granted to Portugal in accordance with the Council Decision of 7 October 1975.
(3) The Community has guaranteed EUR 5 497 million, of which EUR 141.5 million is covered by a 100% guarantee for Portugal.
(4)  Poland, Hungary.
(5) Czech Republic and Slovak Republic, Bulgaria, Romania.
(6) Poland, Hungary, Czech Republic and Slovak Republic, Bulgaria, Romania, Baltic States and Albania.
(7) Central and Eastern Europe, Mediterranean, Asia and Latin America, South Africa.
(8) South-eastern Neighbours, Mediterranean countries, Latin America and Asia, Republic of South Africa, Special action Turkey, as amended (2005/47/EC).
(9) A special lending action for selected environmental projects in the Baltic Sea basin of Russia under the Northern Dimension.
(10) A special lending action for certain types of projects in Russia, Belarus,Republic of Moldova and Ukraine.
(11) Restated and amended in 2005.
(12) Pre-Accession countries, Neighbourhood and Partnership countries, Asia and Latin America, Republic of South Africa.
(13) The amount decided of EUR 27 800 million is broken down into a basic ceiling of a fixed maximum amount of EUR 25 800 million and an optional mandate of EUR 2 000 million.

10 976

11 058

 80

 1

 928

17 400

 77

 3

1 188

17 317

EN 

10 

EN 

 
  
 
 
1.3. 

Evolution of risk 

1.3.1. 

Situation of loans to Member States 

The  risk  towards  Member  States  should  decrease  in  future  for  the  loans  disbursed  under 
Euratom, MFA and EIB guaranteed financing. 

However, the total risk toward Member States is increasing. This situation is explained by the 
activation  of  the  Balance-of-Payment3  facility  in  2008  with  new  BoP  loan  disbursements 
planned in 2009 and 2010. 

Hungary will reimburse in 2011 its first tranche of EUR 2 billion disbursed in December 2008 
(included in Graph A1). 

In addition, one tranche of EUR 2 billion disbursed in 2009 for Hungary will be reimbursed in 
2014.  Two  other  tranches  of  EUR 1 billion  for  Latvia  and  EUR 2 billion  for  Hungary, 
disbursed  in  2009  will  be  reimbursed  in  2014.  Three  additional  tranches  totalling 
EUR 4.2 billion  disbursed  during  the  second  semester  2009  will  be  reimbursed  in  2015  and 
2016. 

Graph A1:  Total  Annual  Risk  borne  by  the  Budget  in  EUR  million  based  on  the 
amounts  (capital  and  interest)  due  under  operations  (MFA,  BoP,  Euratom  and  EIB) 
disbursed at 30.06.20094 with the Member States. (EUR million) 

4 000 

3 500 

3 000 

2 500 

2 000 

1 500 

1 000 

500 

-

ATOM

MFA

EIB

BOP

2009

2010

2011

2012

2013

2014

2015

3 
4 

Council Regulation (EC) No 332/2002 of 18 February 2002 (OJ L 53, 23.2.2002, p.1). 
As of 31 December 2007, the 2008 annual risk for Member States was EUR 769 million. 

EN 

11 

   EN 

 
 
                                                 
1.3.2. 

Situations of loans to third countries 

At 30 June 200, a total of EUR 4 794 million remained to be disbursed by the EIB under the 
EUR 20 060 million EIB external lending mandate for 2000– 2007: 

Table A5: Disbursement forecast for EIB loans on general mandate 2000 - 2007 

Mediterranean
South-Eastern Neighbours**
Asia, Latin America
South Africa
Member States*

Ceiling

Loans made available
(minus cancellations) at
30.06.2009***

EUR million

to be disbursed

6 520
10 235
2 480
 825

20 060

6 416
7 372
2 135
 824
2 763

19 510

1 636
2 156
 112
 194
 696

4 794

* EUR 2,763 million for Member States are not included (Bulgaria, Hungary, Lithuania, Romania, Slovakia, Slovenia).
** The ceiling includes Terra Turkey and Special Action Turkey.
*** Signatures up to 31.07.2008

At the same date, an amount of EUR 7 449 million remained to be disbursed out of signatures 
made under the EIB external mandate for 2007-2013. 

Table A6: Disbursement forecast for EIB loans on general mandate 2007 - 2013*

A. Pre-Accession Countries
B. Neighbourhood and partnership countries
C. Asia and Latin America
D. South Africa

*the current mandate only covers the period until 31 October 2011.

Ceiling

Loans made available
(minus cancellations) at
30.06.2009

EUR million

to be disbursed

8 700
12 400
3 800
 900

25 800

3 621
3 163
1 504
 323

8 611

3 252
2 695
1 199
 303

7 449

Graph A2: total Annual Risk borne by the Budget in EUR million based on the amounts 
(capital  and  interest)  due  under  all  operations  (MFA,  Euratom  and  EIB)  disbursed  at 
30.06.2009 with third countries. (EUR million) 

EN 

12 

   EN 

 
 
 
 
 
 
 
1600

1400

1200

1000

800

600

400

200

0

ATOM

MFA

EIB

2009

2010

2011

2012

2013

2014

2015

Graph A3  presents  the  result  of  simulations  of  disbursement  scenarios  under  the  mandates 
preceding the current EIB external mandate, as well as under the current mandate, established 
for  the  period  1  February  2007—31  October  2011  by  Decision  No  633/2009/EC  of  the 
European Parliament and of the Council of 13 July 2009. The rhythm of disbursements has a 
strong impact on the amount of the provisioning of the Fund in future years. 

Graph A3: Estimated outstanding amount covered by the Fund from 2009 to 2013. 

n
o

i
l
l
i

m
R
U
E

35 000

32 500
30 000

27 500

25 000
22 500

20 000

17 500
15 000

12 500

10 000
7 500

5 000

2009

2010

2011

2012

2013

EN 

13 

   EN 

 
 
 
 
1.4. 

Payment under the Budget guarantees 

1.4.1.  Borrowing/lending operations 

In this type of operation, the EU borrows on the financial market and on-lends the proceeds 
(back-to-back)  to  Member States  (balance  of  payments),  third  countries  (macro-financial 
assistance) or utility companies (Euratom). 

The loan repayments are scheduled to match the repayments of the borrowings due from the 
EU. If the recipient of the loan is in default, the Commission will first draw on its own cash 
resources to ensure a timely repayment of the EU borrowing on the contractual due date. 

Should  the  amounts  needed  for  the  necessary  cash  coverage  exceed,  in  a  certain  period  or 
date,  the  available  Commission's  treasury  balances,  the  Commission  would,  in  accordance 
with article 12 of Council Regulation 1150/20005., draw on additional cash resources from the 
Member States in order to fulfil its legal obligations towards its lenders.  

In  the  case  of  BoP  loans,  where  reimbursed  amounts  can  be  very  high,  the  beneficiary 
Member States are requested to deposit the amounts due at the European Central Bank seven 
business  days  in  advance  of  the  contractual  due  date.  This  gives  enough  time  for  the 
Commission and Member States to provide for the cash advance to ensure timely repayment 
in case of default. 

In a second step, the treasury situation will be regularised as follows: 

Euratom and MFA loans: 

a) 

b) 

if the payment delay reaches three months after the due date, the Commission draws 
on the Fund to cover for the default and obtain the necessary funds to replenish its 
treasury.  

the Commission might also need to draw on the Budget, most likely by means of a 
transfer to provide the corresponding Budget line under article "01 04 01 European 
Community  guarantees  for  lending  operations"  with  the  necessary  appropriations 
needed  to  cover  the  default.  This  method  is  used  when  there  are  insufficient 
appropriations in the Fund or if the borrower is a Member State6 and the transfers are 
likely to require advance authorisation by the budgetary authority  

c) 

by the re-use of recovered funds, if any. 

Balance of Payments (BoP) loans: 

a) 

by the re-use of funds from late payments 

5 

6 

Council  Regulation  (EC,  Euratom)  No  1150/2000  of  22  May  2000  implementing  Council  Decision 
2007/436/EC, Euratom of 7 June 2007 on the system of Communitie's own resources. 
Regarding the loans and loans guaranteed to accession countries, they were covered by the Guarantee 
Fund  and  remained  outstanding  after  the  date  of  accession.  From  that  date,  they  cease  to  be  external 
actions of the Communities and are therefore covered directly by the Budget. 

EN 

14 

   EN 

 
                                                 
b) 

the  Commission  may  also  need  to  propose  a  transfer  or  an  Amending  Budget  to 
budget the cash advance under the corresponding budget line "01 04 01 01 European 
Community guarantee for Community loans raised for balance-of-payment-support".  

1.4.2.  Guarantees given to third parties 

The  EU  provides  a  guarantee  in  respect  of  financing  granted  by  the  EIB  under  the  external 
mandates. When the recipient of a guaranteed loan fails to make a payment on the due date, 
the EIB asks the Commission to pay the amounts owed by the defaulting entity in accordance 
with the relevant guarantee agreement. The guarantee call must be paid within three months 
of receiving the EIB's request, either from the Fund or directly from the Budget (should the 
resources of the Fund be insufficient). The EIB administers the loan with all the care required 
by  good  banking  practice  and  is  obliged  to  seek  to  recover  the  payments  due  after  the 
guarantee has been activated. 

Since  the  entry  into  force  of  the  Regulation  establishing  the  Guarantee  Fund  for  external 
actions7, the provisions of the Agreement between the EU and the EIB on management of the 
Fund state that, after the EIB calls in the guarantee in the event of a default, the Commission 
must authorise the Bank to withdraw the corresponding amounts from the Fund within three 
months. 

If there are insufficient resources in the Fund, the procedure used for activating the guarantee 
is the same as for borrowing/lending operations, see 1.4.1 above. 

1.4.3.  Activation of Budget guarantees 

If  a  borrower  defaults  on  an  EIB  financing  operation  guaranteed  by  the  Budget,  the  EU 
guarantee  is  called  upon  at  the  earliest  three months  after  the  date  on  which  payment  has 
fallen due. The EU will act within three months of receiving such a letter from the EIB calling 
for the guarantee to be activated, authorising the EIB to take the corresponding amounts from 
the Fund if the beneficiary is a non-Member State or to receive payment from the Budget if 
the beneficiary is a Member State (see 1.4.2 above). 

For loans granted by the EU or Euratom, default interest is owed by loan beneficiaries for the 
time between the date on which cash resources are made available by the Budget and the date 
of  repayment  to  the  Budget.  For  EIB  loans,  default  interest  is  calculated  during  the  period 
between  the  due  date  of  a  defaulted  loan  instalment  and  the  date  of  receipt  of  the  cash 
resources  by  the  EIB  from  the  Commission.  From  the  date  of  payment  to  the  EIB,  default 
interest is due to the Commission. 

7 

Council  Regulation  (EC,  Euratom)  No  480/2009  of  25 May 2009  establishing  a  Guarantee  Fund  for 
external actions (codified version), the "Guarantee Fund Regulation" (OJ L 145, 10.6.2009, p.10). 

EN 

15 

   EN 

 
                                                 
2. 

COUNTRY-RISK EVALUATION 

Third countries other than those presented in the main report, but representing important risks 
to  the  Budget  in  2009,  notably  through  EU  macro-financial  assistance,  Euratom  loans  or 
guaranteed  EIB  projects  related  financing,  and  either  categorised  as  “severely  indebted” 
according to criteria set by the World Bank or facing significant imbalances in their external 
or debt situation are also included in the risk evaluation. The country risk evaluation presented 
below comprises short analyses and tables of risk indicators. 

Explanatory notes for country-risk indicators 

Standard footnotes 

a) 

Includes  only  EU  and  EIB  loans  (outstanding  disbursements)  to  CEEC,  NIS  and 
MED. 

b) 

The higher the ranking number, the lower the creditworthiness of the country. 

Countries are rated on a scale of zero to 185; 185 represents the least risk of default. 
A  given  country  may  improve  its  rating  and  still  fall  in  the  ranking  if  the  average 
global rating for all rated countries improves. 

Abbreviations and English words used in tables 

S&P 

CCFF 

EFF 

FDI 

GDP 

SBA 

STF 

est. 

m EUR 

bn USD 

n.a. 

Standard and Poor's 

Compensatory and Contingency Financing Facility 

Extended Fund Facility 

Foreign Direct Investment 

Gross Domestic Product 

Stand-By Arrangement 

Systemic Transformation Facility 

Estimates 

EUR million 

USD billion 

not available 

EN 

16 

   EN 

 
 
 
2.1. 

Candidate countries 

2.1.1.  Turkey 

The  economic  crisis  hit  Turkey  mainly  via  the  trade  and  financial  channels.  After  having 
decelerated to 0.9% in 2008, real GDP growth fell by 10.6% year-on-year in the first half of 
2009.  Collapsing  external  demand  led  to  a  double-digit  decline  of  exports  while  a  lower 
availability  of  external  financing  and  domestic  credit  depressed  private  consumption  and 
investment.  The  recession  seems  to  have  bottomed  out  in  the  first  quarter  of  2009,  but  the 
recovery  will  be  slow  as  the  external  demand  remains  sluggish  and  the  fiscal  stimulus  is 
gradually being phased out. Overall, economic output is expected to decline by around 6% in 
real terms in 2009, followed by positive - but below potential - growth in the following years. 

The trade and current deficits have declined substantially in the first half of 2009 as imports 
shrunk by more than 25% in volume terms and the terms of trade improved on lower oil and 
commodity prices. Both the public and private sector continued to roll-over external debt at 
reasonable  rates  given  the  decline  in  economic  activity  and  tighter  domestic  lending 
conditions. Gross FDI inflows fell from 2.4% of GDP in 2008 to about 1% of GDP in the first 
half of 2009. Turkey's external debt declined by about 5% in nominal terms from 2008 until 
the first quarter of 2009 and currently amounts to about 40% of GDP. Private external debt 
represents two thirds of the total debt and is also on a declining trend. International reserves 
fell by about 5% to EUR 50 billion, and still cover about 5 months of imports. As a result of 
the  improved  risk-appetite  for  emerging  markets  as  of  the  second  quarter  of  2009,  the 
domestic currency recovered some of the losses incurred previously against the USD and the 
EUR and the central bank resumed its FX purchases since the beginning of August. 

Country-risk indicators

Gene ral indicat ors

Balance of  pay m ents

Ex ter nal debt

Indicators of EU exposure

IMF arr angem e nts

Indicat ors of  m ar ket 's pe rception of 
creditw ort hiness

(a) (b)  

Turkey

footnotes

2007

2008

2009

(%)
(% change)
(% of labour force)
(% ch an g e)
(TL p e r EUR)
(% of GDP)
(m EUR)
(% of GDP)
(m EUR)

(m EUR)

(m EUR)
(m EUR)
(m EUR)
(%)
(%)
(%)
(m EUR)

(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Industrial production 
Unemployment (end of period)
Inflation rate (CPI) (Dec/Dec)
Exchange rate (end of period)
Ge n eral g o ve rn m en t  b al an ce
Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   m EUR
   months' imports of goods and services
Convertible currency external debt
   (e n d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)
See explanatory notes at beginning of the tables.

(a)

(b)

4.7
6.9
9.9
8.8
1.72
-1.0
146 947
-5.9
14 693

51 998
5.4
183 749

34 816
26 900
7 916
38.4
232.5
45.4
none
none
2 285
22.4
1.2
1.6
SBA
(05/08)
yes

-5.8
-6.5
13.5
6.5
2.20
-8.0
100 100
-1.7
5 500

45 421
5.3
204 000

38 748
30 890
7 858
36.5
241.9
50.6
none
none
4 871
34.2
2.4
4.9
none

0.9
-0.9
11.0
10.4
2.09
-2.2
122 413
-5.5
10 495

50 360
4.4
208 822

37 716
29 358
8 358
37.5
210.7
40.3
none
none
4 848
34.5
2.3
4.0
SBA
(until 05/08)
yes

Ba3
BB-

Ba3
BB-
03/07    09/07 03/08   09/08 03/09  09/09
69   76
185   186

72   68
185   185

68   67
186   186

Ba3
BB-

EN 

17 

   EN 

 
 
2.2. 

Potential candidate countries  

2.2.1. 

Serbia 

As  of  the  fourth  quarter  2008  Serbia  became  increasingly  affected  by  the  global  economic 
crisis and real GDP growth over the first semester 2009 fell to -3.5% year-on-year, down from 
6.0% in 2008. Industrial output was about 17.5% lower in the first half of 2009 compared to 
the  same  period  in  2008.  Exports  in  the  second  quarter  of  2009  were  lower  by  32%  while 
imports were down by 41% compared to the same quarter of 2008. After having increased to 
17% of GDP in 2008, the current account deficit narrowed, mainly due to the drop in imports, 
and was expected to fall down to around 9% of GDP in 2009. Net FDI slowed down in the 
first half of the year and is expected at around 3.3% of GDP in 2009 against 6.0% in 2008. In 
May, the IMF board approved a substantial revision of the stand-by arrangement (SBA) that 
was agreed in January 2009. The new SBA allows the access to EUR 3 billion funds over 27 
months, of which EUR 770 million of EUR 2.1 billion that was planned for 2009, has already 
been  drawn  in  May.  Following  the  commitment  in  March  2009  of  private  EU-based  parent 
banks to maintain their exposure on Serbia, the roll-over of private external debt was expected 
to cover a substantial share of external financing needs. After having decreased over the first 
quarter,  foreign  reserves  increased  on  the  back  of  resuming  capital  inflows,  reaching 
EUR 8.8 billion  on  30  June  2009,  against  EUR  8.1  billion  on  31  December  2008.  External 
debt increased to 73% of GDP while private external debt accounts for 67% of this. 

Country-risk indicators

Serbia

footnotes

2007

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

(%)
(% change)
(% of labour force)
(% ch an g e)
(CSD p er  EUR)
(% of GDP)
(m EUR)
(% of GDP)
(m USD)

(m EUR)

(m EUR)
(m EUR)
(m EUR)
(%)
(%)
(%)
(m EUR)

(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Industrial production 
Unemployment (end of period)
Inflation rate (CPI) (Dec/Dec)
Exchange rate (end of period)
Gen er al g o ver n m en t  b alan ce
Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
  m USD
   months' imports of goods and services
Convertible currency external debt
   (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

(1)

(a)

(2)

(b)

2008

5.5
1.1
13.6
10.9
81.44
-2.5
7 428
-17.6
2 363

2009

4.1
-17.5
15.5
10.0
94.20
-1.0
5 338
-7.5
1 168

8 160.4
6.3
21 801

8 848.8
8.1
21 687

3 400
NA
NA
66.6
293
45.8
2 161
no
1 194
8.5
5.5
16.1

941
NA
NA
67.4
23.6
44.1
2 392

1 222
8.6
5.6
22.9

6.9
3.7
18.8
6.8
79.90
-2.0
6 432
-14.9
2 004

9 641
8.6
17 789

2 140
NA
NA
61.1
277
33.3
1 763
no
812
8.0
4.6
12.6
-
-
-

none
BB-

none
BB- 
  03/07  09/07    03/08  09/08 03/09  09/09
88   126
185   186

87    87
185   185 

122   109
186  186

none
BB-

Footnotes
(1)

(2)
(a) (b)  

In November 2001, the Paris Club creditors agreed on a highly concessional two-phased debt restructuring of 66% in NPV terms.
The first phase (51%) became effective in May 2002 when the IMF adopted the new three-year Extended Arrangement (EA); 
the second phase (15%) will become effective upon successful completion on the EA.
Serbia B+, Montenegro BB.
See explanatory notes at beginning of the tables.

EN 

18 

   EN 

 
2.3. 

New Independent States  

2.3.1.  Georgia 

The  global  financial  and  economic  crisis  strongly  affected  Georgia  and  thus  further 
exacerbated the economic downturn caused by the military conflict with Russia that occurred 
in  summer  2008.  The  real  GDP  declined  by  4%  in  2009.  The  economic  contraction  was 
driven  by  the  decline  in  domestic  demand  caused  by  tightening  in  bank  credit;  fall  in 
remittances  and  in  foreign  direct  investment  inflows.  For  2010,  real  GDP  growth  of  2%  is 
expected. 

Budget deficit reached to 9.4% of GDP in 2009. An important share of this deficit was due to 
the contraction of fiscal revenue caused by recession. As far as public debt is concerned, with 
the on-set of military and economic crisis in 2008, the public debt stopped its declining trend. 
The  major  part  of  public  debt  that  was  estimated  at  25%  in  2008  and  36.9%  in  2009  is 
external public debt. 

In early November 2008, the authorities allowed the exchange rate to depreciate against the 
US dollar by around 17%. More recently, seeing consumer inflation decreasing the National 
Bank of Georgia focused on providing sufficient liquidity to the banking system, while at the 
same  time  intervening  to  limit  the  depreciation  of  the  lari  so  as  to  support  consumer 
confidence. 

The  IMF  Board  approved  in  mid-September  2008  an  18-month  stand-by  arrangement  for 
USD 750 million which constitutes exceptional access at 300% of Georgia's quota. The third 
programme review under the SBA was approved by the IMF Board on the 6th of August 2009. 
The main result of this review is the extension of the duration of the SBA until June 2011 and 
the increase in the financing package by about USD 424 million. 

The Commission is planning to provide macro-financial assistance to Georgia amounting to 
EUR  46  million  in  grants.  This  assistance  is  part  of  a  comprehensive  EU  package  of  up  to 
EUR 500 million to support Georgia's economic recovery through the global crisis. The EU 
macro-financial  assistance  will  contribute  to  covering  Georgia's  external  financing  needs  in 
2010 

EN 

19 

   EN 

 
 
Count ry-risk indicat ors

Georgia

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

(%)
(% change)
(% of labour force)
(% ch an g e)
(Lar i p er  USD)
(% of GDP)
(commitments)
(m USD)
(% of GDP)
(m USD)

(m USD)

(m USD)
(m USD)
(m USD)
(%)
(%)
(%)
(m USD)

(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Industrial production 
Unemployment (end of period)
Inflation rate (CPI) (Dec/Dec)
Exchange rate (end of period)
Gen er al g o ver n m en t  b alan ce

Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   m USD
   months' imports of goods and services
Convertible currency external public debt
  (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
  (number of countries)

12.4
15.0
13.3
9.2
1.59
-3.0

3182
-19.6
1562

1361
2.2
1790

2.1
6.7
16.5
10.0
1.66
-4.7

3688
-22.7
1523

1480
3.3
2691

-4.0
n/a
n/a
1.8
n/a
-9.6

2998
-15.1
700

2005
4.1
3394

171
131.7
38.9
35.7
115
11.9
0
no
65
0.6
5.3
3.0
PRGF
(06/04-06/07)
yes

n.a.
n.a.
n.a.
42.0
146
16.0
0
no
61
0.4
3.1
2.3
Stand-by
(09/08-03/10)
yes

n/a
n/a
n/a
55.1
198
23.8
n/a
n/a
60
0.4
2.5
2.8
Stand-by
09/08-06/11
yes

none
B+
03/07   09/07
114    114
(185)   (185)

none
B

none
B

03/08    09/08 03/09    09/09

126    88
(185)   (186)

102   111
(186)  (186)

(1)

(2)

Sources: International Monetary Fund.
Footnotes
(1) (2) 
(a)

See explanatory notes at beginning of tables.
Officially registered unemployed.

EN 

20 

   EN 

 
 
 
2.4.  Mediterranean partners 

2.4.1. 

Jordan 

Following  a  strong  performance  in  2008,  GDP  growth  is  predicted  to  dip  to  3%  in  2009. 
Investment is set to fall sharply driven by a decline in FDI from surrounding Arab States as 
oil  earnings  have  shrunk.  The  slowdown  has  affected  growth  in  a  number  of  sectors, 
particularly  construction,  real  estate,  and  export  industries.  Private  consumption  growth  is 
predicted  to  slow  from  3.8%  in  2008  to  2.5%  in  2009  on  account  of  a  slackening  labour 
market  and  falling  remittances.  The  government  deficit  is  set  to  expand  to  around 
12.5% of GDP  both  on  account  of  a  fall  in  tax  revenue and an increase in capital spending. 
The government aims to cover the expansion of the deficit by increased foreign aid. Despite 
the  slowdown,  unemployment  is  not  expected  to  rise  markedly  given  the  large  number  of 
migrant workers in the sectors most affected. 

Inflation has been declining since the third quarter of 2008 with the CPI going into negative 
territory in the second quarter of 2009. Annual average CPI for 2009 is forecast to be 1.7% 
compared to 14.9% in 2008. Both the trade and current account balance are set to narrow. The 
current account deficit is expected to fall from 11.9% of GDP in 2008 to around 6.5% of GDP 
in  2009,  strongly  influenced  by  the  decline  in  food  and  fuel  prices.  Jordan's  banking  sector 
has not been seriously affected by the global economic crisis on account of limited exposure 
to  international  property  and  equity  markets.  As  a  precautionary  measure,  government  has 
guaranteed all bank deposits until the end of 2009. 

Countr y-risk  indica tors

Jorda n

footnotes

2007

2008

General indicators

Balance of  pay m ents

Ex ter nal debt

Indicators of EU exposure

IMF arr angem e nts

Indicat ors of  m ar ket 's pe rception of 
creditw ort hiness

Sources: International Monetary Fund.
Footnotes
(1) (2)  
(a)

(%)
(% of labour force)
(% ch an g e)
(JOD p er  USD)
(% of GDP)
(bn USD)
(% of GDP)
(bn USD)

(bn USD)

(bn USD)
(bn USD)
(bn USD)
(%)
(%)
(%)
(m USD)
(m USD)
(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Unemployment (average)
Consumer price Inflation (average)
Exchange rate (end of period)
Gen er al  g o vern m e n t  b alan ce
Exports of goods and services f.o.b.
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   bn USD
   in months of next years imports of goods and services
Convertible currency external debt
   (en d  o f  p e rio d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

See explanatory notes at beginning of tables.
Officially registered unemployed.

(a)

(1)

(2)

6.6
13.1
5.7
0.7
-8.2
6.4
-17.0
?

7.9
8.5

5.6
12.7
9.4
0.7
-9.9
7.2
-11.9
?

8.9
9

2009

3.1
13.5
6.7
0.7
-12.9
7
-6.8
?

10.2
10

41.5

34.0

32.3

302
3.0
N/A
6.9
-
-
-

Ba3
BB
03/07   09/07
75   74
(185)   (185)

299
2.1
N/A
5.8
-
-
-

Baa3
BB

286
2.0
N/A
5.8

Ba2
BB

03/08  09/08 03/09  09/09

74    75
(185)   (186)

73   69
(186)   (186)

EN 

21 

   EN 

 
 
 
2.4.2.  Egypt 

The weathering global crisis is affecting the economic developments in Egypt, mainly via the 
trade  channel  but  also  via  the  channels  of  the  financial  markets.  As  to  trade,  exports  have 
fallen  sharply  due  to  falling  global  demand.  As  to  the  financial  markets,  in  particular  the 
Egyptian stock exchange suffered tremendous losses since April 2009 when it coupled with 
the  stock  exchange  developments  of  developing  countries.  Nonetheless,  thanks  to  fiscal 
stimulus packages and the loosening of monetary policy the authorities succeeded in keeping 
economic growth positive. 

In fiscal year 2009 economic growth reached 4.7%. Whereas, growth reached 7% on average 
in the three preceding years, business investments (including inventories) and exports drove 
down growth in this year. Expectations are that growth will remain at around 4% in FY10. 

The fiscal stimulus package of more than 1.5% of GDP that was implemented in a reaction to 
the global slowdown is not helping to improve the fiscal budgetary situation. The government 
debt stock is still high and the budget deficit, that was 7.5% in FY09, will turn out to be closer 
to  8%  in  FY10  although  it  is  still  pencilled  in  at  6.9%  by  the  authorities.  In  addition  to  the 
worsening  fiscal  stance  the  privatisation  processes  are  stalled.  The  multitude  of  public 
enterprises remains a drain on the government budget and hampers a proper functioning of the 
internal market. 

Monetary policy is supportive of the economic situation. The exchange rate has been kept in a 
suitable  range,  with  a  quasi-fixed  peg  to  foreign  currencies  with  weights  that  mimic  the 
weights of the composition of the foreign reserves. A positive externality of the global crisis 
is that the trend of soaring consumer prices recently stopped. Consumer price inflation on an 
annual basis fell to below 10% in the last months. A vulnerability to the Egyptian economy is 
that the expected global upturn in the year 2010 may put again pressure on prices, crowding 
out purchasing power of consumers and investors.  

Count ry-risk indicat ors

Egypt

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

Sources: International Monetary Fund.
Footnotes
(1) (2) 
(a)

Real GDP growth rate
Unemployment (average)
Consumer price Inflation (average)
Exchange rate (end of period, + is depreciation of LE)
Gen er al g o ver n m en t  b alan ce
Exports of goods and services f.o.b.
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   bn USD
   in months of next years imports of goods and services
Convertible currency external debt
   (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

See explanatory notes at beginning of tables.
Officially registered unemployed.

(%)
(% of labour force)
(% ch an g e)
(LE p er  EUR)
(% of GDP)
(bn USD)
(% of GDP)
(bn USD)

(bn USD)

(bn USD)
(bn USD)
(bn USD)
(%)
(%)
(%)
(m USD)
(m USD)
(m EUR)
(%)
(%)
(%)

(a)

(1)

(2)

7.2
8.5
11.7
8.1
-7.5
56.6
0.5
7.0

34.6
7.5
33.9

10.9
1.7
9.2
20.1

0.2

2 141
15.2
8.8
5.3

4.7
8.9
16.2
7.6
-7.9
49.0
-0.4
2.8

31.3

31.5

12.9
3.3
9.6
17.0

0.3

2 129
14.9
9.5
6.1

7.1
9.5
11.0
7.5
-7.5
42.5
1.7
10.6

28.6
6.1
29.9

9.6
1.2
8.4
22.8

0.2

1 680
16.5
8.3
5.8
-
-
-

Ba1
BB+

Ba1
BB+
03/07   09/07 03/08   09/08 03/09   09/09
68   68
(185)   (186)

71      69
(185)   (185)

70   70
186   186 

Ba1
BB+

EN 

22 

   EN 

 
 
 
2.4.3.  Lebanon 

The latest economic indicators show a quite robust performance of the Lebanese economy in 
spite  of  the  global  financial  crisis.  Real  GDP  growth  is  expected  to  top  4%  on  average  in 
2009, still a slowdown from the 8.5% growth reached in 2008. Leading indicators suggest that 
economic  activity  was  picking  up  in  the  course  of  the  first  half  of  2009.  This  to  no  small 
degree reflects the fact that the financial sector proved remarkably resilient to the politically 
uncertain environment. Inflation has fallen, reflecting strong global disinflationary forces.  

The  Lebanese  economy  has  so  far  been  quite  resilient  to  the  impact  of  the  crisis  on  the 
banking  system.  Lebanese  banks  have  long-standing  experience  in  operating  in  a  strained 
economic and political environment, have had limited exposure to structured products under 
long-standing  prudential  directives  by  the  central  bank  supervisors,  and  have  not  borrowed 
heavily  on  international  markets  –  if  only  because  of  Lebanon's  impaired  investor  status. 
Together with a healthy development of the deposit base, a relatively strong reserve position 
(which helped sustain the currency peg to the US dollar as a strong nominal anchor) (8), and 
high  liquidity  ratios  buffering  against  liquidity  shocks,  this  has  helped  shield  the  financial 
sector. In fact, ongoing deposits and reserve inflows during 2009 have strengthened buffers. 

The disbursements of IMF financing under EPCA II and the of the first tranche of the grant 
and  loan  instalments  of  EU  MFA  in  late  December  2008  (EUR  15  million)  and  May  2009 
(EUR 25 million) respectively should help stabilise public finances. Nevertheless, the state of 
Lebanese  public  finances  remains  precarious  in  view  of  high  debt  and  deficit  ratios.  The 
issuance of government bonds is costly in view of high interest rate spreads, whereas the large 
dependence on the domestics banking sector to place debt is a burden on the diversification of 
the financial sector. 

8 

The dollar rate of deposits is very high in Lebanon, hovering around 70% in 2008. 

EN 

23 

   EN 

 
                                                 
Country-risk indicators

Lebanon

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

Real GDP growth rate
Industrial production (period average)
Unemployment rate (average)
Inflation rate (CPI, av)
Exchange rate (av)
Gen er al g o ver n m en t  o ver all b alan ce
Pr im ar y b alan ce
To t al g o ver n m en t  d eb t
Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   m USD
   months' imports of goods and services
Convertible currency external debt
  (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
Foreign currency debt/GDP
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
  (number of countries)

(%)
(% change)
(% of labour force)      (a)
(% ch an g e)
(L£ p er  USD)
(% of GDP)
(% of GDP)
(% of GDP)
(m USD)
(% of GDP)
(m USD)
(gross useable)

(m USD)

(m USD)
(m USD)
(m USD)
(%)
(%)
(%)
(%)
(m USD)
(m USD)
(m EUR)
(%)
(%)
(%)

(1)

(2)

2.6
n.a.
n.a.
4.1
1508
-10.8
1.8
168
4 077
-7.1
1.875

17 417
4.9
21 221

1 511 
n.a.
n.a.
84
194
576
41
n.a.
n.a.
354
3.5
2.5
12.8
-
-
-

4.5
n.a
n.a
0.3
1508
-10.5
1.3
151
n.a.
-9.5
n.a.

n.a.
n.a.

187.0 

545
3.8
N/A
N/A

8.5
n.a
n.a
10.8
1508
-10.0
1.4
162
5 259 

-11.4

2.608 

25 094 
8.1
21 550 

1 534 
n.a
n.a
n.a
187.0 
472 

33.6
n.a
n.a
508
3.6
3.3
13.5
EPCA II
adopted 3-11

(concluded June 2009)

B3
B-
03/07   09/07
111    116
(185)   (185)

B 3
B-
03/08   09/08
127   134
(185)   (186)

B2
B-
03/09   09/09
111    116
186   186

Sources: International Monetary Fund.
Footnotes
(1) (2)  
(a)

See explanatory notes at beginning of tables.
Officially registered unemployed.

EN 

24 

   EN 

 
             
             
           
 
           
        
             
             
      
                
 
2.4.4.  Tunisia 

The  impact  of  the  global  crisis  is  increasingly  being  felt  in  Tunisia,  especially  in  exporting 
industries. Real GDP growth in the first quarter of 2009 was -2.0% quarter-on-quarter, driven 
by  a  decline  across  a  broad  range  of  industries.  The  fall  in  economic  activity  was  most 
pronounced  in  engineering  and  in  the  textile  industry,  as  the  effects  of  the  slump  in  major 
Tunisian export markets were being felt. Exports to the EU, which accounts for nearly 80% of 
Tunisian  exports,  were  particularly  affected.  But  production  volumes  also  decreased  against 
the previous quarter in transport and communications and in business services. For the year as 
a whole modest growth of 2% is projected, premised on the upturn in the world economy that 
is taking shape. This would lead to a recovery in Tunisian and exports. The slowdown in the 
first part of 2009 followed a relatively robust performance of the Tunisian economy for 2008 
when real GDP growth reached 5%, against 6.3% in 2007. Consumer price inflation peaked at 
6.0%  year-on-year  in  April  2008  and  moderated  subsequently,  to  around  4%  in  the  thrid 
quarter of 2009. As elsewhere in the region, a sharp pick-up and subsequent deceleration in 
food and energy prices was the main determinant of overall inflation trends in 2008 and 2009. 
The  cushioning  of  the  initial  several  commodity  price  shocks  in  the  first  half  of  2008  via 
transfers and subsidies helped stabilize inflation but did imply an additional fiscal burden. 

In response to the crisis, the government announced measures to support exporting companies 
(in  particular  export  guarantees  and  less  stringent  exchange  restrictions),  to  increase 
investment incentives, to reduce social security contributions for affected companies, and to 
facilitate  access  to  finance  for  SMEs.  Easier  monetary  policy  supported  the  economy  via 
lower policy interest rates and a reduction in reserve requirements. 

As  regards  fiscal  policy,  the  government  deficit  reached  a  better-than-expected 
deficit  of  1.2%  of  GDP,  with  figures  suggesting  a  slowdown  of  tax  revenues  and 
expenditure compared to the previous year. For 2009 a higher deficit of nearly 4% of 
GDP is foreseen. The 2009 budget foresees a 20% increase in public infrastructure 
expenditure to partly offset the expected decrease in private investment. The public 
debt ratio is forecast to increase slightly, to 48.5% of GDP, from 47.5% of GDP in 
2008. Over the medium term, the authorities have expressed continued commitment 
to fiscal consolidation and debt reduction. 

EN 

25 

   EN 

 
Count ry-risk indicat ors

Tunisia

footnotes

2007

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

Real GDP growth rate
Unemployment (average)
Consumer price inflation (average)
Exchange rate (end of period)
Gen er al g o ver n m en t  b alan ce
Exports of goods and services f.o.b.
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   bn USD
   in months of next years imports of goods and services
Convertible currency external debt
   (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

Sources: International Monetary Fund.
Footnotes
(1) (2) 
(a)

See explanatory notes at beginning of tables.
Officially registered unemployed.

(%)
(% of labour force)
(% ch an g e)
(TD p er  USD)
(% of GDP)
(bn USD)
(% of GDP)
(bn USD)

(bn USD)

(bn USD)
(bn USD)
(bn USD)
(%)
(%)
(%)
(m USD)
(m USD)
(m EUR)
(%)
(%)
(%)

(a)

(1)

6.3
14.1
3.1
1.27
-2.9
15.0
-2.6
1.6

7.9
4.6

54.9
123.3
13

10 185
15.3
N/A
15.3
-
-
-

?

-
-
-

2008

5.0
14.0
5.1
1.31
-1.2
19.2
-4.2
1.9

8.9
4.1

2009

forecast

na

na

Na

2.5 

14.3
3.8

-3.8

-3

10.2
4.2

51.8
96.4
9.9

na
na

51.2

14 047
12.0
N/A
12.2

14 245

12.4
N/A
N/A

Baa2

Ba
BB BBB (stable)
03/07   03/07  09/07

Baa2

Baa2

BBB (stable) BBB (stable)
03/08  09/08 03/09   09/09

(2)

(185)  

62    64
(185)    (185)

62    64
(185)) (186)

  53       52
  186    186

EN 

26 

   EN 

 
            
 
2.4.5.  Morocco 

Following strong growth in 2008, GDP Growth is set to slow to around 2.5% in 2009 as the 
Moroccan economy feels the impact of the global economic crisis. In the first half of 2009, 
exports fell by 32.2% and tourism revenue by 11.1%. Remittances (amounting to nearly 10% 
of  GDP)  declined  by  12.1%,  this  tendency  reflects  the  worsening  employment  situation  in 
Europe. Offsetting some of the negative impact of the global economic crisis, the agricultural 
sector continued to grow strongly, by 17% in the first quarter of 2009. The government has 
also proceeded with an extensive social housing programme providing a boost to investment. 
After  registering  a  mild  surplus  in  2008,  the  general  government  balance  is  likely  to  turn 
negative  in  2009  mainly  on  account  of  lower  tax  revenues  from  slowing  economic  activity. 
The  government  has  targeted  a  deficit  of  2.9%  of  GDP  for  2009  which  appears  achievable 
given the budgetary outturn to date. The budget ran a modest surplus in Q1 2009 pointing to 
the  possibility  of  a  better-than-targeted  outturn  for  the  whole  year.  Unemployment  has 
continued to fall to 8% mainly on account of hiring in the agricultural sector. 

Since  the  end  of  2008,  the  CPI  has  been  gradually  declining  driven  by  a  reversal  in 
commodity prices and slowing economy activity. The CPI turned negative in June 2009 and is 
likely  to  be  around  2%  on  average  for  2009  from  3.9%  in  2008.  The  current  exchange  rate 
regime  is  tightly  managed  against  a  euro-dominated  basked  of  currencies.  The  authorities 
have  taken  gradual  steps  to  lessen  currency  controls  with  the  aim  of  introducing  a  fully 
floating currency in the future. The current account deficit is expected to narrow in 2009 to 
around -4% of GDP due to a marked improvement in the trade balance influenced by lower 
oil and wheat prices. 

Count ry-risk indicat ors

Morocco

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

(%)
(% of labour force)
(% ch an g e)
(MDH p er  USD)
(% of GDP)
(bn USD)
(% of GDP)
(bn USD)

(bn USD)

(bn USD)
(bn USD)
(bn USD)
(%)
(%)
(%)
(m USD)
(m USD)
(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Unemployment (average)
Wholesale price Inflation (average)
Exchange rate (end of period)
Gen er al g o ver n m en t  b alan ce
Exports of goods and services f.o.b.
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   bn USD
   in months of next years imports of goods and services
Convertible currency external debt
   (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

(a)

(1)

(2)

Sources: International Monetary Fund.
Footnotes
(1) (2)  
(a)

See explanatory notes at beginning of tables.
Officially registered unemployed.

3.2
9.8
2.0
7.7
0.2
24.4
-0.3
?

24.7
10.0

6.2
9.5
3.8
8.1
0.4
23.2
-6.6
?

22.7
9

2.6
9.1
2
7.85
-1.1
21.5
-4.2

21.5
8.8

26.8

22.5

22.2

1 275
12.5
N/A
7.7
-
-
-

1 929
13.7
N/A
11.6
-
-
-

2 014
14.1
N/A
13.2

Ba1
BB+

Ba1
BB+
03/07    09/07 03/08   09/08 03/09  09/09
66      63
(185)   (186)

65     65
(185)    (185)

63    54
186    186 

Ba1
BB+

EN 

27 

   EN 

 
 
                        
 
2.5. 

Other countries 

2.5.1. 

South Africa 

A  sharp  decline  in  external  demand  and  a  slump  in  commodity  prices  have  pushed  the 
economy  into  its  first  recession  since  1992.  South  Africa's  economy  will  likely  contract  by 
about 2% in 2009, but recover next year, supported mainly by a strong counter-cyclical policy 
response and a global recovery. The central bank has cut its policy rate by 450 bps since the 
start of the year, to the current level of 7.0%, but the scope for further easing may have been 
exhausted  if  inflation  is  to  be  brought  within  the  target  range  (3%-6%)  by  end-2010. The 
expansionary  fiscal  stance  is  appropriate  given  the  weak  economic  outlook,  and  strikes  the 
right  balance  between  supporting  demand  and  preserving  medium-term  sustainability.  If 
output turns out weaker than expected, the automatic stabilisers should be allowed to operate, 
but  spending  growth  would  need  to  be  moderated  further  when  the  economy  recovers,  in 
order to stabilize medium-term public debt at a prudent level. There are risks to the medium-
term fiscal position, particularly if complementary reforms to improve public service delivery 
and enhance efficiency in infrastructure provision are delayed. One can expect though that the 
government  will  respect  their  intention  of  keeping  debt  levels  below  50%  of  GDP.  The 
current account deficit was relatively high, financed by quite volatile capital inflows (mainly 
portfolio  investments).  The  deficit  has  come  down  in  the  first  three  quarters  in  2009  as  the 
weak  internal  demand  caused  the  drop  in  imports  to  exceed  export  decline.  Concerns  about 
financing  have  receded  in  line  with  a  resumption  of  net  capital  inflows,  but  South  Africa 
remains vulnerable to a sudden reversals. The current account deficit is expected to rise again 
with an economic recovery. In the near term, the key challenge for macroeconomic policies is 
to  strike  the  right  balance  between  supporting  domestic  demand  and  maintaining  domestic 
and  external  stability.  A  strong  push  for  structural  reforms  to  address  the  long  standing 
barriers  to  growth  and  employment  is  urgently  needed  also  to  improve  macroeconomic 
stability. 

South  Africa's  financial  system  is  resilient.  When  the  global  financial  crisis  intensified  last 
year, South African money markets remained orderly and the country's financial institutions 
were stable. Interbank interest rate volatility remained within normal bounds in late 2008 and 
early 2009, reflecting generally adequate market liquidity. South African banks' low leverage, 
high profitability, and limited exposure to foreign assets and funding allowed them to remain 
liquid and well capitalised, obviating any need for extraordinary liquidity or state support. 

EN 

28 

   EN 

 
Count ry-risk indicat ors

Sout h Af rica

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

(%)
(% change)
(% of labour force)
(% ch an g e)
(SAR p er  EUR)
(% of GDP)
in bn US $
(m EUR)
(% of GDP)
(m EUR)

(m EUR)

(m EUR)
(m EUR)
(m EUR)
(%)
(%)
(%)
(m EUR)

(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Industrial production 
Unemployment (end of period)
Inflation rate (CPI) (Dec/Dec)
Exchange rate (end of period)
Gen er al g o ver n m en t  b alan ce
Exports of goods and services
Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   m EUR
   months' imports of goods and services
Convertible currency external debt
   (en d  o f  p er io d )
Convertible currency debt service
   principal
   interest
External debt to official creditors/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

(a)

(b)

5.1
5.8
22.7
7.1
10.04
0.8
89.2
65074
-7.3

$33,0bn
45234
3.7

1.8
78.4

none
none
666
6.5
N/A
1.0
none

3.1
4.5
21.9
11.5
12.08
-0.7
97.9
66562
-7.4
14
$34,1bn
50154
4.6

1.6
80

none
none
636
4.5
N/A
1.0
none

-1.9
-13.0
24.9
7.2
8.60
-4.4
81.3
58986
-5.1

$35,8bn
49343
4.5

1.7

none
none
624
4.4
N/A
1.1
none

Baa1

Baa1

Baa1

BBB+

BBB+
03/07  09/07 03/08  09/08 03/09  09/09
55    54
185   186

  50     47
186     186

55    55
185   185

BBB+

EN 

29 

   EN 

 
 
2.5.2.  Mexico 

For  2009,  Mexico  forecasts  to  experience  its  deepest  contraction  in  decades  with  GDP 
contracting by around 7.3%. Thereby, it is one of the countries to be hit hardest by the global 
economic and financial crisis. Mexico's budgetary leeway depends for a significant part on oil 
revenues, with 30% – 40% of fiscal revenues coming from oil proceeds. Not only the falling 
oil  price  was  detrimental  to  the  government's  possibilities  but  oil  production  has  declined 
since its peak in 2006 and is expected to decline further. In the worst scenario, oil production 
may end within a decade but this depends on the reform of the state oil company and further 
investments. 

Because  of  the  limited  possibilities  for  economic  stimulus  through  fiscal  policy,  monetary 
policy  actions  were  a  crucial  part  of  the  response  to  the  crisis.  The  Mexican  central  bank 
lowered its reference rate from 8.25% to 4.5% between the January 2009 and July 2009. The 
IMF expects inflation in Mexico to fall in 2009 (4.3%) and fall further in 2010 (4.1%) but to 
remain above the medium term target. 

Mexico has been running current account deficits for several years and is expected to continue 
into 2010. The current account deficits have been of limited size, however, averaging 0.8% of 
GDP. In April of this year, Mexico was one of the countries to receive access to a Flexible 
Credit Line (FCL) of the IMF amounting to USD 47 billion. This has helped the country in 
stabilizing the  exchange  rate after a real effective depreciation of 20.6% (37.6% against the 
USD)  between  September  2008  and  March  2009.  The  currency  rate  is  expected  to  remain 
stable.  The  banking  sector  has  weathered  the  financial  crisis  relatively  well  compared  with 
more advanced economies. 

Count ry-risk indicat ors

Mexico

footnotes

2007

2008

2009

General indicators

Balance of  paym ent s

Ext ernal debt

Indicators of EU exposure

IMF arrangem ent s

Indicat ors of  m arket 's percept ion of  
credit w ort hiness

(%)
(% change)
(% of labour force)
(% chang e)
(MXN p er  USD)
(% of GDP)
(commitments)
(bln USD)
(% of GDP)
(bln USD)

(bln USD)

(bln USD)
(bln USD)
(bln USD)
(%)
(%)
(%)
(m USD)

(m EUR)
(%)
(%)
(%)

Real GDP growth rate
Industrial production 
Unemployment (end of period)
Inflation rate (CPI) (Dec/Dec)
Exchange rate (end of period)
Gen er al g over nm en t  b alance

Exports of goods and services
Current account balance
Net inflow of foreign direct investment
Official reserves, including gold (end of period)
   bln USD
   months' imports of goods and services
Convertible currency external debt
   (en d o f p er io d)
Convertible currency debt service
   principal
   interest
External debt/GDP
External debt/exports of goods and services
Debt service/exports of goods and services
Arrears (on both interest and principal)
Debt relief agreements and rescheduling
EU exposure (capital and interest due)
EU exposure/total EU exposure
EU exposure/external debt
EU exposure/exports of goods and services
Type
(Date)
On track

Moody's long-term foreign currency rating (end of period)
S&P long-term foreign currency rating (end of period)
Euromoney
   Position in the ranking 
   (number of countries)

(a)

(b)

Footnotes
(a) (b)  

See explanatory notes.

3.3
2.4
3.7
3.8
10.9
-1.4

271.9
-0.8
18.9

87.2
3.1
193.1

18.8

96.5
0.95
0.07
0.05
PRGF
(06/04-06/07)
yes

1.3
-0.9
4.0
6.5
13.5
-1.8

291.3
-1.4
18.2

95.3
4.2
200.4

43.5

18.2
64.1
14.3

77.4
0.55
0.05
0.04
PRGF

-7.3
-7.9
5.0
4.3
13.5
-4.9

232.4
-1.2
15.7

95.3
4.1
202.5

57.2

24.5
99.7
21.7

74.6
0.52
0.05
0.05
Stand-by

(06/04-06/07) (09/08-03/10)

yes

yes

none
B+

none
B+
03/06   09/06 03/07   09/07 03/09    09/09
51    48
(185)   (185)

48   50
(186)   (186)

52   50
(185)   (185)

none
B

EN 

30 

   EN