Open AccessEXTERNAL DEBT IMPLICATIONS ON THE DEVELOPMENT OF NATIONAL ECONOMY
Author(s) -
Victoria Iordachi
Publication year - 2020
Publication title -
economie şi sociologie
Language(s) - English
Resource type - Journals
eISSN - 2587-3172
pISSN - 1857-4130
DOI - 10.36004/nier.es.2019.2-03
Subject(s) - external debt , solvency , debt , internal debt , economics , market liquidity , developing country , debt to gdp ratio , business , economic policy , finance , economic growth
The external debt of the Republic of Moldova is increasing constantly. Excessive external debt has been a big problem for both developing and developed countries during the years. Developing countries face this problem more often as they need to borrow to finance their objectives and strengthen the economic growth. It is very important for our country to determine the optimal level of indebtedness that the economy can bear. That is why the external debt should be contracted in strict accordance with the needs of the economy, and borrowed loans should consider the country’s reimbursement capacities to avoid the liquidity or solvency crisis. The scope of this paper is to give a prompt and correct overview of the importance of external debt management and its impact on the economic growth of the country. In the research process, the deduction, based on general theoretical information on the structure, management, external debt and indebtedness assessment, the economic influence policies were used and then passed on to practical analysis using specific indicators.