Germany's record debt

2023-07-04 14:23:00, Ekonomi CNA

Germany's total debt has never been higher - it reached a record level at the end of the first quarter of this year. According to the Federal Statistics Agency, the main reason for this high debt is above all the increase in expenses in the fight against the energy crisis, but there are other reasons as well.

The total debt of the state at the federal level, at the level of the states and municipalities, including the social security debt, reached in the first quarter of the year to about 2,406.6 billion euros. That was the debt on March 31. Compared to the end of 2022, this means an increase of 1.6 percent, or about 39 billion euros more.

Only the debt of the federal state in the first three months of this year has increased by 2.4 percent, to about 1.660 billion euros. The Federal Statistics Office announced that the increase in debt was mainly the result of "increased financing needs, as a result of the current energy crisis, which is also related to Russia's mega-aggression against Ukraine".

Billions for energy and price containment

About 200 billion euros have been reserved for the so-called curbing of gas prices and financial support for energy suppliers. Therefore, the increase in debt is mainly the result of additional budgets created for this purpose, the so-called special property.

In November last year, the Energy Economic Stabilization Fund was established. This special fund only in the first three months of this year led to an increase in public debt by 73 percent - by 22 billion euros to a total of 52 billion euros, the Reuters news agency reported. Also, the debt for mitigating the consequences of the pandemic increased by 53 billion euros and a special fund was created with expenses of 802 million euros for the needs of the German Bundeswehr.

Debts have decreased the most in Bavaria

When it comes to the German lands, there was a slight decrease in debt by 0.5 percent to a total of 604 billion euros. Bavaria reduced its debts the most, by 16.8 percent to around 32.45 million euros. North Rhine-Westphalia has the largest debt – but this land also has the largest number of inhabitants. In this period, this country had about 3 percent more debts than a year ago - with a total of 236 million euros.

On average, this means a debt of 13,065 euros per capita in Germany.

While in the municipalities, unlike the states, debts have increased by 1.9 percent to a total of 143 billion euros./ DW