Spanish Public Debt Declines In July Yet Remains At Historic High
Spain News
Published: 19 September 2023 16:56 CET
In July, the debt of all Spanish public administrations saw a modest decline of 0.7 percent, reaching 1,558 billion euros, as reported by the Bank of Spain. While this reduction is a positive sign, it follows a record-high level reached in June, making it the second-highest figure in the historical series.
Over the past year, Spain's public debt has surged by 4.8 percent, equivalent to an increase of 71,486 million euros. This financial strain is attributed to reduced income and increased expenses brought on by the COVID-19 pandemic, the Ukraine conflict, and rising prices.
The Spanish Government had initially set a target of reducing the debt to 110 percent of GDP by 2024, as per the Stability Program established in April. However, updated Gross Domestic Product (GDP) data from the National Institute of Statistics has expedited this goal, with the objective now being to reach below 110 percent by the end of 2023.
The decrease in debt for July primarily stems from reductions in the debt of the State, autonomous communities, and city councils. Conversely, Social Security debt remained relatively stable during this period.
Specifically, the State's debt lowered to 1,390 billion euros in July, marking a 0.5 percent decrease compared to the previous month. Nonetheless, over the past year, it has surged by 6.3 percent.
Autonomous communities also made efforts to reduce their debt in July, which stood at 325,834 million euros, reflecting a 0.4 percent decrease from June. However, on an annual basis, there was a 3.7 percent increase in their debt levels.
Social Security debt remained stable in July, with a total of 106,169 million euros, just five million less than in June. Nevertheless, over the past year, it has risen by 7 percent, reaching its maximum levels. This increase is attributed to loans extended by the State to the organisation's General Treasury to cover budgetary shortfalls.
Lastly, city councils reported a debt of 23,495 million euros in July, representing a 1.2 percent decrease from the previous month. However, over the last year, this debt has increased by 1.7 percent, reflecting ongoing financial challenges at the municipal level.
While the reduction in debt for July is a positive development, Spain faces the challenge of meeting its revised debt reduction targets by the end of 2023 amidst the persisting economic uncertainties.
Source
https://www.rtve.es/noticias/20230919/deuda-publica-se-aleja-maximos-junio-cae-julio-07-hasta-1558-billones/2456314.shtml
https://www.estrategiasdeinversion.com/analisis/bolsa-y-mercados/informes/la-deuda-publica-en-espana-cae-un-07-en-julio-n-647713
