23.Jan .2021 00:00

Government Deficit At 5.6% Of GDP In The EU

Government Deficit At 5.6% Of GDP In The EU
views 295
Back

During Q3 2020, the seasonally adjusted government deficit stood at 5.8% of GDP in the euro area and 5.6% of GDP in the EU, which is a large improvement compared to the second quarter of 2020. 
 
In the third quarter of 2020, the seasonally adjusted general government deficit to GDP ratio stood at 5.8% in the euro area and 5.6% in the EU. The third quarter of 2020 saw a sharp rebound from the highest deficit recorded in the euro area and the EU since the start of the time series in the second quarter of 2020 and continued to be influenced by policy responses to the COVID-19 pandemic. The deficit to GDP ratio decreased due to GDP growth, higher revenue, and lower expenditure. In the third quarter of 2020, all Member States continued to record a government deficit.
 
These data are released by Eurostat, the statistical office of the European Union.
 
As for the seasonally adjusted government revenue and expenditure for the euro area and EU, in the third quarter of 2020, total government revenue in the euro area amounted to 46.2% of GDP, compared with 47.7% of GDP in the second quarter of 2020. This decrease as a percentage of GDP is due to a stronger relative increase in GDP than the increase in total revenue – seasonally adjusted total revenue in the euro area increased by around €99 billion compared with the second quarter of 2020. Total government expenditure in the euro area stood at 52.1% of GDP, a significant decrease in the ratio compared with 59.6% in the previous quarter. Seasonally adjusted total government expenditure decreased by around €41 billion compared with the second quarter of 2020, mainly due to a lesser impact of policy measures to mitigate the economic and social impact of the COVID-19 pandemic.
 
In the EU, total government revenue was 46.0% of GDP in the third quarter of 2020, a decrease compared to 47.4% of GDP in the second quarter of 2020. Total government expenditure in the EU was 51.6% of GDP, a decrease compared with 59.0% of GDP in the previous quarter.