Abu dhabi: The euro area's government debt-to-GDP ratio increased to 88.9 percent at the end of the first quarter of 2026 from 87.7 percent at the end of the previous quarter, while the European Union's ratio rose to 82.9 percent from 81.8 percent. According to Emirates News Agency, Eurostat reported this data on Wednesday, highlighting the ongoing fiscal challenges in the region.
Compared to the first quarter of 2025, the debt-to-GDP ratio saw an increase from 87.2 percent to 88.9 percent in the euro area and from 81.4 percent to 82.9 percent across the EU. This rise reflects the continued pressure on government finances amid economic recovery efforts.
At the end of the first quarter, the composition of government debt in the euro area included 84.3 percent in debt securities, 13.2 percent in loans, and 2.5 percent in currency and deposits. In the EU, these shares were 83.6 percent, 13.9 percent, and 2.5 percent, respectively.
The quarterly data on intergovernmental lending (IGL) as a percentage of GDP at the end of Q1 2026 stood at 1.3 percent in the euro area and at 1.1 percent in the EU, indicating a slight reliance on intra-EU financial support mechanisms.
The highest government debt-to-GDP ratios at the end of Q1 2026 were recorded in Greece (143.5 percent), Italy (138.9 percent), France (117.6 percent), Belgium (109.1 percent), and Spain (101.6 percent). Conversely, Estonia (25.2 percent), Denmark (26.8 percent), Bulgaria (28.5 percent), and Luxembourg (29.2 percent) registered the lowest ratios.
Out of the EU Member States, 17 reported an increase in their debt-to-GDP ratio at the end of Q1 2026 compared to the fourth quarter of 2025, while eight experienced a decrease. The ratio remained unchanged in Latvia and Czechia. Notably, Hungary and Lithuania saw the largest increases, whereas Greece recorded the largest decrease in its debt ratio.