The ecuation (2) reflects the annual change in public debt to GDP ratio as result from the interaction of
primary balance (fiscal balance – debt interests expenditures), “snowball” effect (the cumulated impact of the
interests expenditures on debt stock and of the real GDP growth and inflation rates on debt to GDP ratio) and
debt/deficit adjustment(financial transations aquisitions/sales of shares/assets by the governement that affect the
debt stock but are not recorded in the primary balance)