Andorra approves programme of up to €1.2 billion to refinance public debt
The new framework will allow the government to prepare for a €500 million repayment in February 2027 without increasing state debt
Andorra’s government has approved a new public debt issuance programme in international markets, with a maximum value of €1.2 billion.
The decree establishes a framework for refinancing the state’s upcoming debt maturities and will allow the government to prepare a new issue to cover €500 million due for repayment on 23 February 2027.
Approval of the programme does not mean that the full €1.2 billion will be issued immediately. Instead, it provides the framework needed for future transactions. According to the government, the planned refinancing will not increase public debt.
The first repayment falls due in February 2027
The next obligation concerns an issue of sustainability notes worth €500 million. Under the new programme, the government will have the framework to approve a new issue to refinance this maturity when it considers market conditions most favourable.
The government describes this advance planning as part of a strategy of financial prudence and risk management amid international geopolitical and financial uncertainty. The aim is to maintain access to capital markets to meet the state’s refinancing needs.
Government forecasts debt at 21.4% of GDP by the end of 2026
According to government figures, the debt-to-GDP ratio is expected to fall from 46.3% in 2021 to 21.4% by the end of 2026, a reduction of 24.9 percentage points.
The government says that further reducing debt remains one of its priorities and places the debt level at its lowest since 2011.
This is the seventh public debt issuance programme approved by Andorra since 2013. The previous decree, dated 23 April 2021, opened international capital markets to Andorran public debt for the first time and introduced the option of issuing social and sustainability bonds.
Programme retains option to issue social and sustainability bonds
The new programme retains this option, with issues aligned with the EU taxonomy for sustainable finance and Andorran legislation promoting the energy transition and tackling climate change.
The programme is governed by Luxembourg law and supervised by Luxembourg’s Commission de Surveillance du Secteur Financier, in accordance with the framework applicable to these transactions in international markets.