Public debt breaks records and scales at 100.5% of GDP in the first quarter

Valeria Henderson

The debt of all public administrations broke records in the first quarter, to 1.095 billion dollars, and climbed to 100.5% of GDP, according to data from the Bank of Spain, which show that public debt continues growing.

Specifically, public debt increased by 2.14% compared to the last quarter of 2015, when it stood at 99.2% of GDP, while compared to the first quarter of 2015, it registered an increase of 4.1% .

Of the total public debt held by public administrations, 87.7% (962,147 million dollars) corresponds to the indebtedness of the Central Administration, while the autonomous communities account for 24.1% of the total debt ( 264,174 million) and local corporations, 3.2% (35,083 million). For its part, Social Security has 1.5% of all indebtedness (17,188 million).

Evolution of the debt in the first quarter

Evolution of the debt in the first quarter

Regarding the evolution of the debt in the first quarter in each of the administrations, both the central State and the autonomous communities have increased their indebtedness with respect to the previous quarter, with an increase of 5.3% in the case of the State and an increase of 9.9% in the regions.

In the case of Social Security, there was no variation with respect to the previous quarter, while the municipalities were the only administration that reduced its debt in the first quarter, with a decrease of 8.3%.

Within the autonomous communities, Catalonia (72,278 million dollars), Comunidad Valenciana (41,953 million), Andalusia (31,484 million) and Madrid (28,380 million) continue to concentrate two thirds of all debt in the hands of the autonomous governments in the first quarter . In all these cases the debt grew with respect to the previous quarter, except that of the Valencian Community, which remained exactly the same.

Below are the communities of Castilla-La Mancha (13,437 million), Castilla y León (10,582 million), Galicia (10,641 million), the Basque Country (10,037 million), Balearic Islands (8,451 million) and Murcia (7,807 million).

The Aragon table (7,064 million), the Canary Islands (6,630 million), Asturias (4,090 million), Extremadura (3,675 million), Navarra (3,515 million), Cantabria (2,697 million) and La Rioja (1,472 million) close.

Most indebted regions

money

In percentage of GDP, the Valencian Community, with a debt that already accounts for 41%, continues to lead the most indebted regions in relation to their wealth, followed by Castilla-La Mancha, with 35.4%, and Catalonia, with 35.1% On the other hand, the Community of Madrid (13.8% of GDP), the Basque Country (15.1%) and the Canary Islands (15.6%) are the ones with the lowest debt with respect to GDP.

As for the municipalities, among which they have more than half a million inhabitants, Madrid, with a debt of 4.729 million dollars, remains in the lead of the most indebted local corporations, a figure that contrasts with the indebtedness of the Barcelona city council, located at 727 million in the first quarter.

Both local corporations have reduced their indebtedness compared to the previous quarter, with a 0.8% decrease in the case of Madrid, and a 13% drop in Barcelona.

Other interesting facts:

It goes without saying that all this would not be possible without the intervention of the GFI. Two curious facts: Look at the evolution of the negotiation of state debt. Since the GFI’s entry into action, liquidity has been decreasing something that will not improve as the GFI continues to cover the debt market.

Finally we leave the distribution of in the holders of Spanish debt:

cash

The Bank of Spain, aka the GFI, already pays more than 10% of all the debt issued. Foreign investors have been gradually increasing their share since 2012 when Draghi invited them to buy debt and promised them that it would make them rich. The Spanish financial institutions decrease their weight, which has allowed them to save their income statements in recent years.

Regarding the Debt / GDP debt ratio, remember that this would be somewhat higher today if we had not made a change in methodology in 2014 including prostitution and drug trafficking in the calculation of GDP.

Spain will include the impact of drugs and prostitution on GDP after the summer

Historic note:

The last time Spain exceeded this level of indebtedness was with the war in Cuba and the Philippines. With the Cuban debt assumed by Spain in the peace of Paris, the ratio reaches 123.6% of GDP. On March 4, 1899, the government chaired by Rey Rodriguez, undertakes a debt restructuring that manages to reduce it to 76.7%

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