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Ireland had the Second-Highest EU Budget Surplus and Eighth-Lowest Debt Level in Q2, Reports Eurostat

In the second quarter of the year, Ireland achieved the second-highest budget surplus in the EU, along with the eighth-lowest debt level, as reported by Eurostat. During April to June, Ireland’s seasonally adjusted budget surplus, representing when revenues surpass expenditures, reached 2.4% of GDP. This marked a stark contrast with the EU’s overall deficit.

Denmark was the sole EU country surpassing Ireland, boasting a surplus of 2.8% of GDP, while Portugal followed closely behind with a 2.3% surplus.

With the exception of Latvia and the Netherlands, most other EU nations recorded budget deficits in the second quarter when analysed in seasonally adjusted terms. The average deficit for the euro area’s 20 member countries stood at 3.3% of GDP during this period, maintaining stability from the first quarter. On a broader scale, the 27-member EU noted a deficit of 3.2%, a slight increase from the 3.1% in the first quarter of 2023.

Eurostat highlighted the significant influence of measures designed to alleviate the impact of high energy prices on government balances during the latter half of 2022 and into 2023. Conversely, measures aimed at mitigating the effects of the COVID-19 pandemic had a considerably reduced impact compared to earlier quarters.

Ireland’s debt-to-GDP ratio stood impressively low at 43.1%, contrasting with the euro area’s average of over 90% and the EU’s average of 83.1%. Greece, Italy, and France carried the highest debt levels, exceeding 100%, while Estonia exhibited the lowest debt level at 18.5% of GDP. Bulgaria, Luxembourg, and Denmark also boasted relatively lower debt levels.

Furthermore, Ireland notably reduced its debt-to-GDP ratio compared to the previous year, with a decrease of over seven percentage points from the second quarter of 2022. Other countries, including Greece, Portugal, and Cyprus, also saw substantial reductions, whereas six nations, such as Luxembourg, Finland, Estonia, the Czech Republic, Slovakia, and Bulgaria, experienced year-on-year increases in their debt levels.

In a quarter-to-quarter comparison with the first quarter of 2023, nine countries observed an increase in their debt-to-GDP ratio, while 18, including Ireland, reported a decrease. The Irish government anticipates a surplus of €8.8 billion for the year, equivalent to 3% of modified gross national income (GNI), alongside a debt of €222.7 billion, representing 76.1% of GNI.

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