Economy

Pandemic fallout wreaks havoc with EU governments' deficits, debts

EU governments' deficit-to-GDP ratio in 2020 rose from 0.5% to 6.9% year-on-year

Gokhan Ergocun   | 21.10.2021
Pandemic fallout wreaks havoc with EU governments' deficits, debts

ISTANBUL 

Last year, when fallout from the COVD-19 pandemic hit economic activity all around the world, government deficits in EU countries rose significantly.

The government-deficit-to-gross-domestic-product (GDP) ratio in the 27-member European Union rose from 0.5% to 6.9% in 2020, according to official figures released Thursday by Eurostat.

Meanwhile, the government-debt-to-GDP ratio in 2020 climbed from 77.2% in 2019 to 90.1% in 2020.

While EU countries' total GDP last year totaled €13.39 trillion ($15.26 trillion), down from €14 trillion in 2019, government debt totaled €12.06 trillion, up from €10.8 trillion.

EU governments' deficits totaled €922.55 billion last year, up dramatically from €76.5 billion in 2019.

During the last year all EU member states posted government deficits, with Spain (-11%), Greece (-10.1%), Malta (-9.7%), Italy (-9.6%), and Romania (-9.4%) seeing the largest.

"All Member States, except Denmark (-0.2%) and Sweden (-2.8%), had deficits higher than 3% of GDP," it added.

On the debt side, the lowest government-debt-to-GDP ratios were posted by Estonia (19.0%), Bulgaria (24.7%), Luxembourg (24.8%), the Czech Republic (37.7%), and Sweden (39.7%).

Thirteen member states had government debt ratios higher than 60% of GDP, with the highest seen in Greece (206.3%), Italy (155.6%), Portugal (135.2%), Spain (120.0%), Southern Cyprus (115.3%), France (115.0%) and Belgium (112.8%), it added.

Last year, government expenditures and revenues in the bloc were 53.1% and 46.3% of GDP, respectively.

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