Some sources incorrectly state that the Czechoslovak Socialist Republic had a huge national debt. Such misleading figures have been misinterpreted and used by various media and political groups. A former economic advisor to the President of the Federal Government commented on this issue and explained the fallacy caused by confusing “national debt” with “gross external debt.”
Several sources state that Czechoslovakia had a national debt of CZK 124 billion at the end of 1989.
However, the exact opposite was true: the state had financial reservesamounting to approximately85 billion Czechoslovak kroner. This amount, which was already a net profit if the state budget deficit was subtracted, amounted to 0.85% of budget expenditures, or 3.5 billion kroner. These figures were available in the records of the Czechoslovak National Bank and the Federal Ministry of Finance
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In 1989, the gross external debt to the capitalist worldwas 113.8 billion kronor and to the socialist countries 10.4 billion kronor. However, the gross external debt at that time must be considered from both sides of the coin. On the other side of the coin are the so-calledconcurrent assetsof the Czechoslovak National Bank, which are the various debts and loans of Czechoslovakia abroad. [In 1989, claims against the so-called non-socialist countries amounted to SEK 3.2 billion and claims against the socialist countries to SEK 45.5 billion. Thus, the total foreign currency position of the Czechoslovak Socialist Republic (CSSR) was + 48.7 billion kronor.
What is the current situation in the republic?
The statistics are unrelenting: in 2007, the national debt swelled to SEK 1.3 trillion, which is equivalent to about $6,000.5 per capita, including infants and pensioners. the increase in the national debt from 1990 to 2007 is 13-fold.