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Europe's government debt increases, GDP falls

2010-11-15 20:57:08 GMT+7 (ICT)

BRUSSELS (BNO NEWS) -- The government deficit and government debt of both the Euro area (EA16) and the EU27 increased in 2009, compared with 2008, while GDP (gross domestic product) fell, a European Union (EU) report released on Monday said.

According to the EU's Eurostat, in the Euro area, the government deficit to GDP ratio increased from 2.0 percent in 2008 to 6.3 percent in 2009, and in the EU27 from 2.3 percent to 6.8 percent.

The report also shows that, the government debt in the Euro area to GDP ratio increased from 69.8 percent at the end of 2008 to 79.2 percent at the end of 2009, and in the EU27 from 61.8 percent to 74 percent.

In 2009, the largest government deficits in percentage of GDP were recorded in Greece (-15.4 percent), Ireland (-14.4 percent), the United Kingdom (-11.4 percent), Spain (-11.1 percent), Latvia (-10.2 percent), Portugal (-9.3 percent), Lithuania (-9.2 percent), Romania (-8.6 percent), Slovakia (-7.9 percent), France (-7.5 percent) and Poland (-7.2 percent), but no Member State registered a government surplus

Meanwhile, the lowest deficits were recorded in Luxembourg (-0.7 percent), Sweden (-0.9 percent) and Estonia (-1.7 percent).

In all, 25 Member States recorded a worsening in their government deficit relative to GDP in 2009 compared with 2008, and two (Estonia and Malta) an improvement.

At the end of 2009, the lowest ratios of government debt to GDP were recorded in Estonia (7.2 percent), Luxembourg (14.5 percent), Bulgaria (14.7 percent), Romania (23.9 percent) and Lithuania (29.5 percent).

Twelve Member States had government debt ratios higher than 60 percent of GDP in 2009: Greece (126.8 percent), Italy (116.0 percent), Belgium (96.2 percent), Hungary (78.4 percent), France (78.1 percent), Portugal (76.1 percent), Germany (73.4 percent), Malta (68.6 percent), the United Kingdom (68.2 percent), Austria (67.5 percent), Ireland (65.5 percent) and the Netherlands (60.8 percent).

In 2009, government expenditure in the Euro area was equivalent to 50.8 percent of GDP and government revenue to 44.5 percent, while the figures for the EU27 were 50.8 percent and 44.0 percent respectively. In both zones, the government expenditure ratio increased between 2008 and 2009, while the government revenue ratio decreased.

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