January 25, 2023
According to the statistical office of the European Union (Eurostat), the third quarter seasonally adjusted government deficit ratio came out to 3.3% in the euro area and 3.2% of GDP in the EU this is an increase compared to the second quarter of 2022. “For the EU and the euro area, significant rises in the deficits were seen as compared to the second quarter of 2022. Significant increases in overall expenditures were the primary cause of the deficit-to-GDP ratio rising. Although to a lesser extent than in prior quarters, the COVID-19 pandemic’s impact on total revenue and total spending persisted. As stated by Eurostat, measures to alleviate the impact of high energy prices started to have a stronger impact on the government balance in the third quarter of 2022 and the majority of member states continued to record a government deficit”.
Eurostat went on to state that in the third quarter of 2022, total government revenue in the euro area and EU amounted to 47.2% (Q2: 47.5%) and 46.4% (Q2: 46.8%) of GDP, respectively. As compared to the second quarter of 2021, “seasonally adjusted overall revenue in the euro area climbed by roughly €15 billion,” stated Eurostat. The total government expenditure in the euro area and EU stood at 50.5% (Q2: 49.5%) of GDP and 48.6% (Q2: 48.65), respectively. “Seasonally adjusted total government expenditure increased by around €58 billion in comparison to the previous quarter, and for the EU, seasonally adjusted total expenditure increased by roughly €67 billion compared with the previous quarter.
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