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Croatia Again Among EU Countries with the Largest Decline in Debt-to-GDP Ratio

Public debt in the EU and the eurozone, expressed as a share of GDP, decreased at the end of the second quarter thanks to the economic recovery from the coronavirus crisis, and Croatia maintained its position among the countries with the largest decline, a report from Eurostat revealed on Friday.

At the EU level, public debt amounted to 86.4% of GDP at the end of June, calculated Eurostat. At the end of March, it was 87.5%.

In the eurozone, it decreased from 95.2% to 94.2%.

At the end of last June, it was 90.5% in the EU, while in the eurozone it was almost equal to GDP.

The lower debt-to-GDP ratio is a result of the economic recovery from the crisis caused by the COVID-19 pandemic, as the debt in absolute terms increased in both areas, notes the European statistical office.

Croatia Alongside Slovenia

The highest public debt expressed as a share of GDP at the end of June was recorded by Greece, nearly double that of GDP.

Italy again found itself in second place with a debt 50% larger than GDP. Following are Portugal, where it was approximately a quarter larger than GDP, and Spain, where it exceeded it by 16%.

In Croatia, the consolidated general government debt amounted to 343.72 billion kuna at the end of June, which corresponded to 74.3% of GDP. At the end of March, it was 342.7 billion kuna, or 77.3% of GDP.

At the end of last June, it amounted to 341.5 billion kuna, which corresponded to 86.3% of GDP.

The closest to Croatia in terms of public debt as a share of GDP in the middle of this year was Slovenia, where it amounted to 73.5%.

The lowest level of public debt expressed as a share of GDP was recorded in Estonia in the middle of this year, at 16.7%. Following are Bulgaria and Luxembourg with 21.3% and 25.4%, respectively.

Highlighted ‘Trio’

Only in three EU countries was public debt expressed as a share of GDP higher at the end of June than three months earlier, with the largest increase in Luxembourg, by 2.8 percentage points.

Following are Czech Republic and Netherlands, where it increased by 0.6 and 0.1 percentage points, respectively.

The largest decrease in the public debt-to-GDP ratio was recorded in Cyprus and Greece, by 6.8 and 6.3 percentage points, respectively.

Following is Croatia, where the public debt expressed as a share of GDP at the end of June was three percentage points lower than at the end of March.

Malta is also close, where it decreased by 2.3 percentage points, and in the group with a more pronounced decline, slightly less than two percentage points, Eurostat highlighted Italy and Ireland.

Sharp Decline in Croatia

Croatia was also classified among the EU countries with the largest decline in public debt expressed as a share of GDP compared to last June, by 12 percentage points.

Only Greece recorded a larger decline, by 25.4 percentage points, and Cyprus, by 14.4 percentage points.

Eurostat also highlights Portugal in this group, where it decreased by 10.8 percentage points, Denmark with a decline of 8.2 percentage points, and Ireland, where it was lower by 7.5 percentage points than at the end of last June.

Only Romania, with an increase of 1.4 percentage points, the Czech Republic, with an increase of 0.9 percentage points, Hungary, with an increase of 0.6 percentage points, and Slovakia, with an increase of 0.1 percentage points, recorded higher debt than in the middle of last year, according to Eurostat’s report.

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