This bachelor degree thesis covers the financing of public debt. It contains detailed description of public debt and its structure of financing it in Republic of Slovenia and Italian Republic. World economy is slowly recovering from the global financial crisis, while Slovenia and Italy are still struggling with it and searching for options to recover. After accession to the EU, both countries committed themselves to comply with criteria of the Maastricht Treaty. Nevertheless, they are both still above the allowed limit set in the Treaty.
The main goal of this thesis is to analyse public debt and its structure of financing.
The main content is composed of several parts. In the first part I try to explain the theoretical basis of public debt, its formation and different possibilities of defining it. Furthermore I explain budget deficit, its financing and types. Moreover, I present instruments of borrowing and burden of debt.
In the second part I focus on describing public debt of Republic of Slovenia, its organisational aspects, formation, term structures, status, financing and structure of debt between 2010 -2016.
In the third part I present public debt of Italian Republic, its formation, status, financing and structure of borrowing between 2010 – 1016. Furthermore, I explain the process of borrowing in Italian Republic.
In the last part I compare public debt of both countries in connection to Maastricht criteria. Due to borrowing on non-domestic markets, under the condition of credit ratings, the functioning and credibility of ratings issued by the three most important credit rating agencies, are included.
To conclude I explain the fact, that Slovenia is not very successful in remediation of public debt and financial deficit. This was also the expected finding of this thesis. Additionally, short commentary of financial structure can be find in this section.
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