Public debt hit new record in second quarter of 2014

SPAIN’S public debt hit a new record between April and June.

The Central Bank released data on Friday revealing that the country’s public debt reached €1 trillion or a debt-to-GDP ratio of 98.9 per cent. Figures show that the Central Government’s debt grew by 7.84 per cent, totalling €885 million (a debt-to-GDP ratio of 86.4 per cent), while the Autonomous Communities’ debt increased by 15.7 per cent, adding up to €228 million (22.3 per cent of GDP). In contrast, the debt incurred by councils throughout Spain decreased by 5.7 per cent and fell to €41 million, which is equivalent to 4.1 per cent of GDP.

This sharp increase can be attributed to the new set of rules included in the European System of Accounts (ESA), which entered into force on September 1 throughout the European Union. This new calculation of Spain’s public debt includes a larger number of public businesses, which had not been taken into account in the calculation of the debt-to-GDP ratio until now.

On the other hand, public debt rose in 11 Autonomous Communities and Catalonia (€61 million), Valencia (€34 million), Andalucia (€26 million) and Madrid (€25 million) are the most heavily indebted regions, followed by Castilla-La Mancha (€12 million), Galicia (€9 million), Basque Country (€9 million), Balearic Islands (€7 million) and Murcia (€6 million).

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