In the end of the third quarter of 2021 the public debt to GDP ratio in the EU and euro area decreased, reflecting an accelerated economic recovery from the corona crisis, and Croatia was among most successful in lowering debt-to-GDP ratio, according to the data provided by Eurostat on Friday.

Economic activity in the EU and the euro area picked up strongly last summer thanks to intensive vaccination rollout programmes coupled with the relaxation of anti-epidemic measures.

Governments stepped up borrowing to finance support measures for enterprises and  households and accelerated economic recovery resulted in a lower debt to GDP ratio.

In the end of the third quarter of 2021, the government debt to GDP ratio decreased to 90.1% from 90.9% in the preceding quarter and to 97.7% in the euro area from 98.3%.

Compared with the third quarter of 2020, the government debt to GDP ratio rose in both the euro area by 1.1 percentage points and 0.9 percentage points in the whole EU.

Croatia alongside Austria and Hungary

The highest ratios of government debt to GDP at the end of the third quarter of 2021 were recorded in Greece (200.7%), Italy (155.3%), Portugal (130.5%), Spain (121.8%), France (116.0%), Belgium (111.4%) and Cyprus (109.6%).

The consolidated government debt in Croatia at the end of September 2021 amounted to HRK 344.7 billion, which was an 82.4% share of GDP. At the end of June, it was HRK 340.8 billion or 86.1% of GDP.

At the end of September 2020, Croatia’s  government debt to HRK 326 billion or 84.7% of GDP.

The closest results to Croatia were registered in Hungary and Austria with ratios of 80.3% and 84.1% of GDP respectively.

The lowest government debt to GDP ratios were registered in Estonia (19.6%), Bulgaria (24.2%) and Luxembourg (25.3%), Eurostat reported.

In the end of the third quarter of 2021, the largest decreases in government debt to GDP ratio compared to the previous quarter were recorded in Greece (-6.6 pp), Portugal (-4.9 pp), Croatia (-3.7 pp), Cyprus and Belgium (both -2.3 pp), Czechia (-2.2 pp), and Austria (-2.1 pp).

The largest increases in the ratio were observed in Hungary (+2.9 percentage points – pp), France (+1.5 pp) and Romania (+1.1 pp).

Croatia was among those countries with the greatest decrease in government debt to GDP compared to September 2020 (-2.3 pp).

The largest decreases compared to September 2020  were observed in Cyprus (-6.4 pp), Ireland (-3.6 pp), the Netherlands (-2.5 pp), Denmark (-2.4 pp), Croatia (-2.3 pp) and Sweden (-2.2 pp).

The largest increases in the ratio were recorded in Spain (+7.8 pp), Hungary (+6.5 pp), Malta (+5.7 pp), Austria (+5.6 pp) and Romania (+5.5 pp), Eurostat reported.