Public debt as a determinant of investment activity and economic growth in Ukraine[La dette publique comme déterminant de l'activité d'investissement et de la croissance économique en Ukraine]

The article highlights the issue of the impact of public debt on the structure of Ukraine's capital markets, its significance for economic growth, and investment activity. The excessive presence of the state, caused by the level of public debt exceeding permissible limits, creates distortions in the supply of credit resources in the markets. An analysis of the dynamics of Ukraine's public debt has been conducted, including an assessment of its size, structure, and growth rates. Key issues related to the dominant presence of public debt instruments in the capital markets, which crowd out private economic agents, particularly non-financial corporations and households, have been systematized. Two forms of the crowding-out effect have been identified, specifically those manifested through the rise in interest rates and the decline in investment activity due to market saturation with government bonds. The focus is on the second form. The economic consequences of the crowding-out effect for the banking system have been analyzed, particularly the reduction in the share of loans in bank portfolios and the increase in the share of government bonds. Results of econometric modeling of the impact of public debt, bank lending, and the debt-to-GDP ratio on Ukraine's nominal GDP are presented. It has been established that an increase in the debt-to-GDP ratio has a significant negative impact on economic development, while bank lending turned out to be an insignificant factor for growth, which can be explained by the effect of crowding out in the markets. The solution to the identified problems and the mitigation of the crowding-out effect lies in the optimization of the country's debt policy, particularly the determination of safe public debt limits and the consideration of the impact of borrowing structure on the capital markets and bank lending trends to support the private sector.