Catalonia’s debt increased by 9.6% while the Spanish Government’s grew by 14% in the last year
The Autonomous Communities are responsible for 18.7% of Spain’s global public debt, while they manage around 40% of the country’s public spending. The Spanish Government’s share represents 76.8% of Spain’s global debt, which reached €804.39 billion at the end of June. Spain’s debt is now 75.9% of the GDP. The Catalan Government has a debt of €43.95 billion. The day before, the Spanish Finance Minister announced that the Catalan Government had a 0.59% deficit for the first half of 2012. Furthermore, Catalonia suffers from a structural fiscal deficit due to Spain’s fiscal redistribution scheme, which annually takes away 8.5% of its GDP, a €17 billion annual solidarity contribution.
Madrid (ACN).- Spain had a \u20AC804.39 billion debt at the end of June 2012, representing 75.9% of the GDP, according to data released by the Bank of Spain on Friday. The Autonomous Communities are responsible for 18.72% of this debt, while they represent about 40% of Spain\u2019s global public spending. In the case of the Catalan Government, the percentage is bigger since it has more powers devolved (such as police or prisons). The Spanish Government is responsible for 76.77% of the country\u2019s global debt, while it manages 50% of the public spending. The Spanish Government had a 617.50 billion debt by June, a 14% increase compared to 12 months previously. The Catalan Government also saw its debt increase significantly, but at a lesser pace. In June, the Catalan Government had a \u20AC43.95 billion debt, which represents a 9.56% increase compared to a year ago. On Thursday, the Spanish Finance Minister, Cristóbal Montoro, announced that the Catalan Government had a 0.59% deficit for the first half of 2012 and is heading \u201Cin the right direction\u201D to meet the 1.5% deficit target for this year. Furthermore, Catalonia suffers from a structural fiscal deficit due to Spain\u2019s fiscal redistribution scheme, which annually takes away 8.5% of its GDP, a \u20AC17 billion annual solidarity contribution.
The Catalan Government had a \u20AC43.95 billion debt at the end of June with banks and investors, a 3.52% increase compared to three months ago. This means that the Catalan Government has a debt level representing 22% of Catalonia\u2019s GDP. A year ago, it was 20.1% of the Catalan GDP, which means that the Catalan Government\u2019s debt was in June 2012 1.9 percentage points higher than 12 months earlier.
Spain\u2019s global debt represented 75.9% of the GDP at the end of June 2012. A year ago, it represented 66.7% of the country\u2019s GDP. This represents an increase of 9.2 percentage points in one year.
Also, around 10 billion of the Catalan Government debt is expiring in less than 1 year. In fact, \u20AC4.73 billion will expire in the very short term and the remaining \u20AC5.64 billion will expire in the short term.
Catalonia gives away between 6.4% and 8.7% of its GDP each year
In 2005, before the economic crisis, the Spanish Finance Ministry published the so-called fiscal balances, which reflect the contributions of the Autonomies Communities. It was the first and only time the data was published, despite previous formal petitions from the Spanish Parliament and constant claims from the Catalan parties. The Spanish Government used two different principles, with different formulas each. The first principle was based on the cost/benefit, which was supposed to better reflect it at an individual level. Four different formulas were used. They showed that Catalonia was giving between 6.38% and 6.69% of its annual GDP to pay for services and investments made in other parts of Spain, excluding common services such as the Spanish army and ministries. This amount would represent between \u20AC13.1 and \u20AC13.5 billion nowadays. The second principle used was the monetary flow, which is the most commonly used principle while calculating statistics such as these. In the two formulas used, Catalonia was giving away between 8.69% and 8.70% of its GDP. The amount represents \u20AC17.8 billion. Studies made by the Catalan Government have concluded that in the last 20 years, Catalonia has been giving 8.5% of its GDP each year, which equates to approximately \u20AC17 billion per year using 2011 figures. Furthermore, after the fiscal redistribution, Catalonia was losing positions in the Spanish ranking of GDP per capita, even being below the average, while subsidised regions were above the average.