Spanish Government Debt Hit a Record 84.1% of GDP in 2012

The Spanish Government’s entire public administration debt increased by 20.1% in 2012 compared to the previous year, and amounted to 884,416 million euros, which is equivalent to 84.1% of the gross domestic product (GDP), and the highest level of the entire historical series. In 2011, this figure was 736,468 million euros. In turn, regional debt rose by 31% to 185,048 million euros.

In the fourth quarter alone, debt increased by 8.2%, quarter-on-quarter. Despite this increase, the final data remained slightly below Government forecasts, which had expected that this variable could rise to 85.3% of GDP in 2012. For 2013, the Government expects the debt level to climb to 90.5% of GDP.

According to data released by the Bank of Spain on Friday, the biggest increase in debt in absolute terms corresponds to the central government, whose debt has grown from 622,298 million euros in 2011, to 760,262 million euros in 2012, equivalent to 72.3% of GDP.

However, El Economista reported that the greatest increase in relative terms has been for the regions, whose debt has increased by 30.9%, from 141,363 million euros in 2011, to 185,048 million euros in 2012, equivalent to 17.6% of GDP, which is also a record for the regional debt level.

The regions with a higher ratio of debt to GDP are Valencia (29.3%), Castilla-La Mancha (27.8%), Catalonia (25.9%) and the Balearic Islands (21.9%). Completing the top five most indebted regions is the area of Levante, Murcia, with 16.8% of GDP.

The regions with a lower ratio of debt to GDP are Cantabria, with 15.8%, Navarra (15.4%) and Galicia (14.6%). Andalusia and Navarre score a ratio of debt to GDP of 14.5% and 14.4% respectively, while Aragon and Extremadura both have a percentage of 13.7%.

By debt volume, Catalonia is placed at the head of the list, with an accumulated debt of 50,948 million euros at the end of 2012. In second place is Valencia, with 29,437 million euros, and third place belongs to Andalusia, with 20,544 million euros. Madrid and Castilla-La Mancha follow, with accumulated debt of 20,130 million euros and 10,190 million euros respectively.

The region with the lowest level of debt is La Rioja, with 1,045 million euros.

Already in the third quarter of last year, the debt of the autonomous regions was one-tenth off the ceiling for the whole of 2013. Up until September, it totalled 167,460 million euros (15.9% of GDP), according to data from the Bank of Spain, and the target for 2013 is around 172,170 million euros (16%), as decided by the Fiscal and Financial Policy Council (CPFF) on 31st July.