Eurostat reports drop in EU’s government deficit to 3 percent of GDP in first quarter
Date
7/23/2024 3:48:29 AM
(MENAFN) On Monday, Eurostat released data showing that the seasonally adjusted government deficit to gross domestic product (GDP) ratio declined to 3 percent in the first quarter of 2024, down from 3.9 percent in the fourth quarter of 2023. This reduction in the deficit ratio suggests a tightening of fiscal conditions compared to the previous quarter.
In terms of government revenue, the European Union experienced a decrease in the total revenue relative to GDP. Specifically, total revenue fell to 45.9 percent of GDP in the first quarter, down from 46.2 percent in the previous quarter. Despite this decline in the percentage of GDP, seasonally adjusted total revenue in the EU actually increased by USD9.8 billion during the same period. This indicates that while the revenue share of GDP decreased, the absolute amount of revenue rose.
For the euro area, seasonally adjusted total revenue decreased by USD2.1 billion in the first quarter compared to the fourth quarter of 2023. Additionally, government total expenditure in the euro area fell to 49.4 percent of GDP, down from 50.7 percent in the previous quarter. This reduction in expenditure as a percentage of GDP suggests a moderation in government spending relative to the size of the economy.
Similarly, in the EU, total government expenditures decreased to 48.9 percent of GDP in the first quarter, compared to 50.1 percent in the fourth quarter of 2023. On a seasonally adjusted basis, total expenditures fell by USD31.5 billion during this period. This decrease in both the percentage of GDP and the absolute amount of expenditures indicates a significant reduction in government spending across the EU.
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