ANKARA (AA) – The Eurozone’s debt burden rose further in the first quarter of 2014, according to official figures, despite years of austerity.
Eurostat, the EU’s statistics office, said on Tuesday that debt across the 18 countries using the euro rose to 93.9 percent of the zone’s annual gross domestic product (GDP) from 92.7 percent the previous quarter.
The increase follows two consecutive quarters of decrease.
In the 28 member-state European Union, the debt-to-GDP ratio increased to 88.0 percent in the quarter from 87.2 in the last quarter of 2013.
Although countries across the region – such as Greece, Italy, Portugal and Spain – have reduced their borrowing through spending cuts and tax increases, they are still running budget deficits which are adding to their debt.
Greece, twice bailed-out by the EU, has the highest ratio of debt in the Eurozone despite its massive austerity program and a write-down of debt owed to private sector investors.
– Debt burden
Greece’s debt burden stood at 174.1 percent of GDP at the end of the first quarter, more than 38 percentage points higher than the next most indebted country, Italy (at 135.6 percent).
The lowest debt ratios were recorded in Estonia at 10 percent, Bulgaria at 20.3 percent and Luxembourg at 22.8 percent.
Germany’s debt, the largest economy in EU, reduced to 77.3 percent of the country’s GDP in the quarter from 78.4 in last quarter of 2013.
Separately, GDP in the Eurozone rose by 0.2 percent and by 0.3 percent in the EU during the first quarter of 2014, compared to the previous quarter.
Inflation in the Eurozone fell from 0.7 percent in April to 0.5 percent in May – lower than the European Central Bank’s target of two percent.
The figure was set to ensure that the economy fully reaped the benefit of price stability while providing an adequate margin to avoid risks of deflation.
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