Is the national debt growing or melting is a topic that, especially in the last year, has become a political baton. The rulers use it to make sure that as a result of their work, the share of debt in the gross domestic product falls, while the opposition claims just the opposite.
In Bulgaria, the issue was brought up to date in June, when the debates on the budget update were ongoing, which, to everyone’s surprise, provided for an increase in the debt ceiling from BGN 7.3 billion to BGN 10.3 billion. The goal of the rulers is to enter the international market at an appropriate time, where they can raise money with which next year Bulgaria will pay its maturing old debts.
The latest Eurostat data are for the first quarter of the year. They show that this share for the EU falls from 88.1% in the first quarter of 2021 to 87.8% at the end of the first quarter in 2022.
The statistics office notes that the slight fall in this ratio in both EU and Eurozone countries is due to the growth of economies outstripping that of government debt in absolute terms.
The largest share of the economy is the government debt of Greece (189.3%), Italy (152.6%), Portugal (127.0%), Spain (117.7%), France (114.4%), Belgium (107.9%) and Cyprus (104.9%).
At the same time, the lowest levels of debt as a share of GDP are seen in Estonia (17.6%), Luxembourg (22.3%) and Bulgaria (22.9%).
Bulgaria is also among the countries whose national debt has shrunk compared to the last quarter of the previous year – by 2.2 percentage points. This also happens in Greece and Lithuania with 4 points each, in Denmark – with 3.7 points, in Ireland – also with 2.2 points, and in Croatia – with 5.5 percentage points.
On an annual basis, however, Bulgaria is among the countries whose debt to GDP shrank by the least – by 1.8 percentage points. A larger reduction is also observed in the countries with the highest debt-to-GDP ratio.
Several countries’ debts have grown as a share of their economies during this time. This is present in France – by 1.9 percentage points, in Italy – by 1.8 points, in Cyprus – by 1.3 points, in Malta – by 1.2 points, in Austria – by 1.1 points, etc.