Who Said Greece Has the Highest Govt Debt?
All eyes are back on Greece in April as the country tries to unlock more funds from international creditors to help mend its battered economy. Despite racking up huge amounts of government debt, Greece is not the most indebted country. The World Economic Forum’s Global Competitiveness Survey looks at the financial health of countries around the world. By looking at the level of gross government debt as a percentage of GDP, it can indicate how able a country is to pay back debts without incurring further debt. Basically the lower the debtto-GDP ratio the better, reports
Its economy is growing slowly and now the central bank has implemented negative interest rates.
The country has taken over €320 billion worth of bailout cash and it’s looking impossible to pay it all back – especially since it has had to implement painful austerity measures to get its loans.
The country used to be a tourist destina- tion but war against Syria and domestic po- litical turmoil has led to a lack of an official budget for months. The services industry accounts for 80% of GDP but high crime, corruption, and unemployment drag the country’s growth down. The International Monetary Fund said Jamaica has to reform its tax system.
The country’s proportion of debt to GDP is the second highest in Eurozone. It spiked this year because the Treasury increased its available liquidity. Portugal exited its own bailout programme in mid-2014. However, GDP was 7.8% lower than it was at the end of 2007.
The country exited its bailout programme two years’ ago but faces a huge debt pile. Ireland has already had success in refinancing a large amount of banking-related debt.
The country’s excessive exposure to Greece hit it hard during the European sovereign debt crisis in 2010. Like Greece, it had to be bailed out by international creditors and enforce capital controls and austerity measures to get funding.
The small Asian economy is closely linked to India and depends heavily on it for financial assistance and foreign labourers for infrastructure. Although the government managed to reduce the budget deficit from a peak of 6% of GDP in 2009 to 3.2% — its debt is still incredibly high.
The island nation is a serviceorientated economy and suffers from poor natural resource base. This means it has to import 82% of its food, leading to vulnerability to market fluctuations.
S&P is confident Spain’s buoyant growth prospects and labour market reforms will boost its outlook. In the second quarter, Spain’s economy grew 3.1% year-on-year.
The economy has been recovering “in fits and starts,” says the country’s statistical agency. But this month PMI services came in better than expected.
The tax haven nation is the wealthiest and most developed country in the Eastern Caribbean but its growth prospects look weak due to austerity measures to combat the effects of the credit crisis eight years ago.
Prior to the credit crisis in 2007, government debt was a modest 27% of GDP. Eight years on and the country is still dealing with the collapse of the banking system.