Lower government bond yields can certainly support sovereign creditworthiness since they reduce the interest service burden
which, relative to government revenue, is an input into our Sovereign Rating Model.
It is also incorrect to state that Rwanda has a debt service burden
because its Debt Service to Exports Ratio and Debt Service to Revenue Ratio are well below the thresholds, indicated in the table below.
An interest rate cut remains a necessity to support growth momentum and reduce high debt service burden
, according to Beltone Financial.
The DSR has consistently remained at single digit levels, said the BSP, and explained that the DSR which relates principal and interest payments or debt service burden
to exports of goods and receipts from services and primary income, is a measure of adequacy of the country's foreign exchange earnings to meet maturing obligations.
The debt service ratio relates principal and interest payments (the debt service burden
) to exports of goods and receipts from services and primary income.
'However, we take the view that it is not just the technical matter of the debt to GDP ratio alone that we should be focusing on, more importantly, we should be focusing on debt service burden
Fitch also views positively the city's new debt policy of attracting long-term loan from EIB, thus limiting the debt service burden
on the city's budget.
RAM Ratings added this is also a step in the right direction towards alleviating the overall debt service burden
in the long run, since the government's cost of financing is cheaper than government-guaranteed debts.
External debts service burden
reached 13.2 billion dollars during 2017-2018 fiscal year, adding that the ratio of the balance of external debts to GDP amounted to 37 percent, which is still safe according to international standards.
It, however, added that as IMF financing carries an annual interest rate of 3 percent that is significantly below market rates (for example, the authorities are paying 6 percent on the 2017 Eurobond), the loan helps to reduce Tunisia's debt service burden
These factors, it noted, would have resulted in higher debt service burden
for Chinese residents borrowing in foreign currency.
This is hoped to reduce the household and corporate debt service burden
immediately since 50 per cent of mortgages and 80 per cent of bank loans to firms have floating rates, which are linked to short and long-term benchmark rates.