October 23, 2020
According to the statistical office of the European Union (Eurostat), the second quarter seasonally adjusted general government deficit of GDP ratio was 11.6% for euro area and 11.4% EU, the highest deficit reported since the start of the time series as well as the sharpest quarter on quarter increase in both the euro area and EU. Also, Eurostat noted, all member states recorded a government deficit in the second quarter.
Furthermore, Eurostat stated that for the second quarter of 2020, total government revenue in euro area and EU closed at 47.4% (Q1: 46.8%) and 47.1% (Q1: 46.3%) of GDP, respectively. Eurostat noted, “this increase as a percentage of GDP is due to stronger relative decreases in GDP than decreases in total revenue – seasonally adjusted total revenue in the euro area decreased by around €132 billion compared with the first quarter of 2020.”
On other hand, total government expenditure of GDP in the euro area and EU was 50% (2020 Q1: 49.3%) and stood at 58.6% (2020 Q1: 48.8%), respectively. Notably, for the euro area, Eurostat stated, “. Seasonally adjusted total government expenditure increased by around €95 billion compared with the first quarter of 2020, mainly due to policy measures to mitigate the economic and social impact of the COVID-19 pandemic.”
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