Foreign Debt

AAA

DEFINITION of 'Foreign Debt'

An outstanding loan that one country owes to another country or institutions within that country. Foreign debt also includes due payments to international organizations such as the International Monetary Fund (IMF). The debt may be comprised of fees for goods and services or outstanding credit due to a negative balance of trade. Total foreign debt can be a combination of short-term and long-term liabilities.

INVESTOPEDIA EXPLAINS 'Foreign Debt'

One relative measurement of foreign debt safety is that foreign exchange reserves should not be less than outstanding short-term foreign debts. Governments can lower their foreign debts by rescheduling their obligations or simply by paying them off. Foreign countries typically hold U.S. debt in the form of short- and long-term government-issued bonds.

RELATED TERMS
  1. Bondholder

    The owner of a government or corporate bond. Being a bondholder ...
  2. Debenture

    A type of debt instrument that is not secured by physical assets ...
  3. Debt

    An amount of money borrowed by one party from another. Many corporations/individuals ...
  4. Bond

    A debt investment in which an investor loans money to an entity ...
  5. Treasury Bill - T-Bill

    A short-term debt obligation backed by the U.S. government with ...
  6. Trade

    A basic economic concept that involves multiple parties participating ...
Related Articles
  1. Debt Monetization: A Nearsighted Government ...
    Economics

    Debt Monetization: A Nearsighted Government ...

  2. A Look At National Debt And Government ...
    Bonds & Fixed Income

    A Look At National Debt And Government ...

  3. Does High GDP Mean Economic Prosperity?
    Economics

    Does High GDP Mean Economic Prosperity?

  4. Basics Of Federal Bond Issues
    Bonds & Fixed Income

    Basics Of Federal Bond Issues

comments powered by Disqus
Hot Definitions
  1. Takeover

    A corporate action where an acquiring company makes a bid for an acquiree. If the target company is publicly traded, the ...
  2. Harvest Strategy

    A strategy in which investment in a particular line of business is reduced or eliminated because the revenue brought in by ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  5. Pareto Principle

    A principle, named after economist Vilfredo Pareto, that specifies an unequal relationship between inputs and outputs. The ...
  6. Budget Deficit

    A status of financial health in which expenditures exceed revenue. The term "budget deficit" is most commonly used to refer ...
Trading Center