According to him, the Czech Republic was one of the minorities in countries where debt and deficit increased, but the Czechia was still one of the least indebted countries in the EU.
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Creditas Bank chief economist Petr Dufek pointed out that the debt of EU countries decreased relatively only due to nominal economic growth.
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“In fact, the debt of the European Union countries increased by 675 billion euros to 12.7 trillion euros. time aside, “he said.
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According to Eurostat, the Czech government’s debt rose from 37.7 percent to 41.9 percent of GDP last year. Only five countries had lower debt: Estonia (18.1 percent), Luxembourg (24.4 percent), Bulgaria (25.1 percent) and Denmark with Sweden (both 36.7 percent).
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By contrast, Greece (193.3 percent) was most indebted despite a significant debt reduction, followed by Italy (150.8 percent), Portugal (127.4 percent), Spain (118.4 percent) and France (112.9 percent).
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“The Czech Republic is still one of the least indebted countries, but its position is no longer as great as, for example, three years ago,” Dufek warned. According to him, the debt trend itself is very unfavorable.
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“Without rapid economic growth, which is now essentially out of the question, or without public budget reform (including taxes), the Czech Republic will only continue to go into debt. he added.
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In a total of 14 countries, the debt exceeded 60 percent of GDP, which is the limit set by the previously binding Stability and Growth Pact. However, the European bloc has suspended its validity after the start of the pandemic in order to support the economies affected by the crisis, and now the countries are preparing to negotiate its updated form.
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Last year, all EU countries, with the exception of Denmark and Luxembourg, recorded a budget deficit. Malta (8.0 percent), Greece (7.4 percent) and Latvia (7.3 percent) had the highest rates.
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The Czechia was one of the countries with an above-average deficit, which increased from 5.8 to 5.9 percent of GDP last year. A total of 15 27 states exceeded the previously valid 3% deficit threshold.
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