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Euro area debt soars to 98% of GDP amid COVID-19 crisis, says Eurostat

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Protesters demand more resources for public health system and against social inequality in the southern neighbourhood of Vallecas, Madrid, Spain, Thursday, Sept. 24, 2020.
Protesters demand more resources for public health system and against social inequality in the southern neighbourhood of Vallecas, Madrid, Spain, Thursday, Sept. 24, 2020.   -   Copyright  Bernat Armangue/AP
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Public deficit and debt soared in the EU as governments massively supported their economies to mitigate the impacts of the pandemic, Eurostat said in a new publication on Thursday.

Among other striking figures, government debt in the euro area reached 98% of GDP, the European statistics agency noted.

"In the euro area, the government debt to GDP ratio increased from 83.9% at the end of 2019 to 98.0% at the end of 2020, and in the EU from 77.5% to 90.7%."

"In the euro area, the government deficit to GDP ratio rose from 0.6% in 2019 to 7.2% in 2020, and in the EU from 0.5% to 6.9%," Eurostat reported.

Greece, which was still reeling from its sovereign debt crisis, had the highest debt in the bloc compared to the size of its economy (205.6%).

Eurostat
A graph ranks government debts in EU member states in 2020Eurostat

It was followed by Italy (155.8%), Portugal, (133.6%), Spain (120.0%), Cyprus (118.2%), France (115.7%) and Belgium (114.1%), Eurostat said.

Spain, Malta, Greece and Italy had the highest deficits.

Eurostat
A graph ranks government deficit in EU Member States in 2020Eurostat

All EU member states except Denmark had deficits higher than 3% of GDP, contrary to EU rules known as the Stability and Growth Pact that have been suspended due to the pandemic.

Last week, three top French economists called for the much-violated rules to be dropped, arguing unnecessary austerity would hamper recovery efforts after the coronavirus crisis.