Government deficit falls, debt increases in euro-zone, whole EU in 2005

The government deficit of the euro-zone and of the whole European Union (EU) fell in 2005 compared to 2004, while the government debt increased, said Eurostat, the statistics office of the EU, on Monday.

In the euro-zone, the government deficit fell from 2.8 percent of GDP in 2004 to 2.4 percent in 2005. The government debt-to-GDP ratio rose from 69.8 percent to 70.8 percent.

In the whole EU, government deficit fell from 2.6 percent to 2.3 percent and government debt rose from 62.4 percent to 63.4 percent.

In 2005, the largest government deficits in terms of percentage of GDP were recorded by Hungary (6.1 percent), Portugal (6.0 percent), Greece (4.5 percent) and Italy (4.1 percent).

Another three member states recorded a government deficit of more than 3 percent of GDP: Britain (3.6 percent), Germany (3.3 percent) and Malta (3.3 percent).

Eight member states registered a government surplus in 2005: Denmark, Sweden, Finland, Estonia, Spain, Ireland, Latvia and Belgium.

In all, 18 member states recorded an improved government balance relative to GDP, while seven saw a worsening situation.

In 2005, the lowest ratios of government debt to GDP were recorded in Estonia (4.8 percent), Luxembourg (6.2 percent), Latvia (11.9 percent) and Lithuania (18.7 percent).

Nine member states had a government debt ratio higher than 60 percent of GDP in 2005: Greece (107.5 percent), Italy (106.4 percent), Belgium (93.3 percent), Malta (74.7 percent), Cyprus (70.3 percent), Germany (67.7 percent), France (66.8 percent), Portugal (63.9 percent) and Austria (62.9 percent).

In 2005, government expenditure in the euro-zone was equivalent to 47.5 percent of GDP, and government revenue to 45.1 percent. The figures for the whole EU were 47.2 percent and 44.9 percent respectively.

Between 2004 and 2005, the government expenditure ratio in the euro-zone stayed the same whereas the government revenue ratio increased.

Source: Xinhua