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News : EU Economy Last Updated: Oct 22, 2013 - 4:23 AM

Spain, Greece and Ireland had the highest budget deficits in the EU in 2012
By Finfacts Team
Oct 21, 2013 - 5:26 PM

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Euro area (EA17): Belgium, Germany, Estonia, Ireland, Greece, Spain, France, Italy, Cyprus, Luxembourg, Malta, Netherlands, Austria, Portugal, Slovenia, Slovakia and Finland.

Spain, Greece and Ireland had the highest budget deficits in the EU in 2012 according to data today from Eurostat, the statistics office of the European Union.

Ireland's deficit as a percentage of Gross Domestic Product (GDP) was 8.2%, behind Spain (10.6%) and Greece (9.0%).

Last Monday, the Central Statistics Office announced that the budget deficit was €13.5bn in 2012, or 8.2% of GDP (gross domestic product) not the previously reported 7.6%.

The CSO said [pdf]: Government revenue from the sales of mobile phone licences was recorded as having being received in 2012, reflecting the fact that the contract was entered into in 2012. CSO subsequently obtained clarification from Eurostat, that as the date of the legal allocation of the licences (as opposed to the contract date) was in the first quarter of 2013, the correct statistical treatment is to record this revenue in 2013. The effect of this change of treatment is a worsening of the 2012 deficit in the amount of €723m. This forms the main component of the change in the reported deficit from €12.5bn in April to €13.51bn in October."

Eurostat said fifteen member states achieved an improvement in their government balance relative to GDP in 2012 compared with 2011, with twelve worsening and one remaining stable.

In 2012, the government deficit of both the Eurozone (EA17) and the EU28 decreased in absolute terms compared with 2011, while the government debt rose in both zones. In the Eurozone the government deficit to GDP ratio decreased from 4.2% in 2011 to 3.7% in 2012 and in the EU28 from 4.4% to 3.9%.

In the Eurozone the government debt to GDP ratio increased from 87.3% at the end of 2011 to 90.6% at the end of 2012 and in the EU28 from 82.3% to 85.1%.

In 2012 the lowest government deficits in percentage of GDP were recorded in Estonia and Sweden (both -0.2%),  Luxembourg (-0.6%) and Bulgaria (-0.8%), while Germany (+0.1%) registered a government surplus. Seventeen member states had deficits higher than 3% of GDP, with the largest registered in Spain (-10.6%), Greece (-9.0%), Ireland (-8.2%), Portugal and Cyprus (both -6.4%).

At the end of 2012, the lowest ratios of government debt to GDP were recorded in Estonia (9.8%), Bulgaria  (18.5%), Luxembourg (21.7%) and Romania (37.9%).

Fourteen member states had government debt ratios higher than 60% of GDP, with the largest observed in Greece (156.9%), Italy (127.0%), Portugal (124.1%) and Ireland (117.4%). In all, six member states recorded an improvement in their government debt relative to GDP in 2012 compared with 2011 and twenty-two a worsening.

Country tables [pdf]

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