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German general government debt down in 2018 by €52 billion to €2.06 trillion – debt ratio down from 64.5% to 60.9%

German general government debt down in 2018 by €52 billion to €2.06 trillion – debt ratio down from 64.5% to 60.9%

29.03.2019 | Deutsche Bundesbank DE FR

General government debt in Germany as defined in the Maastricht Treaty was down in 2018 by 52 billion, amounting to €2.063 trillion at the end of the year. The debt ratio, meaning the ratio of debt to nominal gross domestic product (GDP), fell from 64.5% to 60.9%. GDP growth contributed 2 percentage points to this. The debt ratio thus declined for the sixth time in succession and is almost back to the ceiling of 60% laid down in the Maastricht Treaty.

All levels of government recorded sizeable surpluses. Central, state and local government, especially central government, used these in order to deleverage (by 36 billion, not taking into account the government-owned “bad banks”). By contrast, the social security funds, which are largely debt-free, used their surpluses to further build up reserves.

The government-owned “bad banks” paid down 16 billion of their debt by realising further parts of their financial assets. Support measures in favour of domestic financial institutions added €183 billion to the debt at the end of 2018, which corresponds to 5.4% of the debt ratio. Assistance measures for euro area countries once again accounted for €88 billion (2.6%).

A revision to the results as from the year 2010 resulted in local government debts now recorded as being higher retroactively, with liabilities of legally dependent operated enterprises allocated to local government. The debt ratio is 0.8% higher on average as a result.

The EU Member States report data on the general government fiscal balance and on debt to the European Commission each year at the end of March and end of September – known as the SGP compliance report. To this end, the Federal Statistical Office calculates the balance and the Bundesbank the debt level.

YearDebt level in billionDebt level in % of GDP
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