DefinePK

Abstract

The paper investigates a semantic confusion about rescheduling and restructuring of a public debt. There issues are not related to the default. The rescheduling refers to the swap of debt towards long term and restructuring as a change in the denomination of the debt. The paper conducts empirical evidence for the swaps involved using the econometrics exercise. The findings of the paper are that a swap of short term replacing long term debt is continuously implemented by the central bank of Turkey. Lengthening the maturity of the debt seems to be covert policy of debt management. The paper reported that another covert policy is that bank often swap local debt for dollar or euro debt or change the currency issuance or restructure it. Even though, the bank is involved in these covert policies, the central bank is publishing this data and making no efforts for hiding such information. Thus, we assume that the rating agencies are aware about these debt transactions due to the fact that these transactions are conducted in market prices. The covert policies are good enough as they seems to be working and should be regarded as such without regard to their interest cost.