Europes debt dynamics keep getting worse in spite of years of cost-cutting and tax hikes designed to return public finances to health.
Official figures showed Monday that the debt burden of the 17 European Union countries that use the euro hit all-time highs at the end of the first quarter even after austerity measures were introduced to rebalance the governments books.
Eurostat,the EUs statistics office,said government debt as a proportion of the total annual gross domestic product of the euro zone rose to a record 92.2 per cent in the first quarter of 2013,from 90.6 per cent the previous quarter and 88.2 per cent in the same period a year ago.
Battered by a global recession,a banking crisis and in some cases lax financial management,a number of euro countries have been forced to take remedial action to deal with their debts,some in return for multibillion bailout loans.
One side-effect of the austerity measures has been to keep a lid on economic growth government spending is a key component of the economy while tax rises can choke consumption and investment. Many euro countries are actually in recessionshrinking economies can make the debt-to-GDP ratio look less favourable.
Greece,which in 2009 became the first euro country to suffer a loss of investor confidence over the state of its public finances,has the highest debt burden in the euro zone of 160.5 per cent. Thats up from the previous quarters 156.9 per cent and from the previous years equivalent 136.5 per cent.
Greece, is expected to start posting growth next year while recording a primary surplus .
The second highest debt-to-GDP ratio in the euro zone is Italys 130.3 per cent.
Though Italy has not needed a financial rescue like Greece,Ireland,Portugal,Spain and Cyprus,its government has pursued a raft of measures to make sure its investors are happy to keep on lending money so it can service its euro 2 trillion debt on its own.
Across the euro zone,total debt stood at euro 8.75 trillion ($11.4 billion) at the end of the first quarter,up from euro 8.6 trillion the previous quarter and euro 8.34 trillion the year before.
Its not just the euro countries that are suffering a debt overhang. Across what was then the 27-country EU,which includes non-euro countries such as Britain and Poland,the debt burden rose to 85.9 per cent at the end of the first quarter from 85.2 per cent the previous quarter and 83.3 per cent the year before.
Total debt stood at euro 11.11 trillion,up from euro 11.01 trillion the previous quarter and euro 10.67 trillion the year before.