Government debt in the EU has hit an all-time high with Ireland having the highest increase in debt to GDP ratio in the first quarter of this year compared with the previous three months, bringing it to a record 125% of GDP — €204bn.
After five years of austerity and consolidation measures in Greece their debt at 160.5% of GDP is the highest in the EU, having experienced the biggest increase of just over 24 percentage points over the past 12 months.
Ireland’s increase was the next largest at 18.3 percentage points, up from 117.4% in Dec 2012.
Ireland’s debt at 125.1% of GDP was the fourth highest in the EU at the end of March, preceded by Greece, Italy at 130.3% and Portugal at 127.2%. The lowest was Estonia at 10%.
The government debt to GDP ratio in the euro area’s 17 members was 92.2% — up from 90.6% at the end of last year which was a much greater increase than that in the EU27 ratio, which rose from 85.2% to 85.9% over the same three months.
Year-on-year comparisons showed a similar result with the increase in the eurozone to 92.2% from 88.2% in the first quarter of 2012, while in the EU27 the increase was from 83.3% to 85.9%.
Eurostat, which released the statistics, also published quarterly data on intergovernmental lending due they said to the involvement of EU governments in financial assistance to some member states.
These figures showed that the share of intergovernmental lending at the end of March was 2.1% of the euro area GDP — up from 1.2% in the first quarter of 2012 and 1.6% for the EU27 — an increase from 0.9% in 2012 Q1. Compared with the fourth quarter of 2012, the debt to GDP ratio showed an increase for 21 countries.
The highest increases were for Ireland, up 7.7 percentage points followed by Belgium at 4.7pp and Spain at 4pp.
Debt ratios decreased in six countries, with the largest decrease Latvia at -1.5pp, Denmark at -0.8pp, Germany at -0.7pp, followed by Britain, Bulgaria and Estonia.
Ireland’s debt to GDP is forecast to begin to decline next year. In 2006 it had a record low of 24.8%.
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