The debt of the public administrations as a whole reached 1,542 trillion euros in May, which is the highest record in the historical series, according to data from the Bank of Spain published this Tuesday. Specifically, the indebtedness of public accounts grew by 5.8% last year. The debt ratio in relation to nominal GDP, however, falls due to the growth of the economy.
The State debt continues to be the highest among the administrations. It reached 1.371 billion in May, which represented an increase of 7.4% over the last year. The indebtedness of the autonomous communities also grew, up to 325,000 million, 3.7% more in the last twelve months, while the debt of local corporations increased 2.6% in year-on-year terms, up to 24,000 million. For its part, Social Security indebtedness stood at 106,000 million, 7% more than a year earlier.
The Government, however, prefers to look at the debt to GDP ratio. Sources from the First Vice-Presidency affirm that the greater growth of the Spanish economy is allowing a reduction of the indebtedness in relation to the GDP. Specifically, government sources point out that public debt would have stood at 112.4% of GDP at the end of the second quarter, 0.8 percentage points below the 113.2% with which 2022 closed.
That 112.4% of GDP would confirm the moderation of the record, “in line with recent months”. However, it is a calculation that is not yet final, pending the National Institute of Statistics next week to offer the final data on growth of the economy for the second quarter of 2023. The Bank of Spain does not offer, for Therefore, at this time an official ratio data, pending confirmation of economic developments. The estimates of different national and international organizations lead Economy to be optimistic.
“The commitment to fiscal consolidation and the higher growth forecast for Spain by the main national and international organizations will allow the reduction in the debt/GDP ratio this year to be greater than expected,” says the Ministry of Economic Affairs.
In the midst of the debate on the new fiscal rules, “Spain has comfortably met the fiscal objectives set for three consecutive years and in the Stability Program it anticipates reducing the public deficit to 3% by 2024 and the public debt ratio below of 110% of GDP, forecasts endorsed by the European Commission”, adds Economía. “In 2022, a record reduction of 5 percentage points was achieved in one year,” she adds.
“Spain maintains the confidence of the markets and investor investors, as reflected in the maintenance of the risk premium around 100 basis points, and an interest rate on short-term debt similar to that of Germany,” he remarks. Nadia Calviño’s team.
