Euro-Area Governments' Debt Reaches Record 85.1% of GDP as Crisis Festers

Bloomberg
April 26, 2011

Euro-area debt reached a record in 2010, making it harder for the bloc’s better-off countries to bear the costs of the fiscal crisis triggered by Greece.

Debt rose in all 16 countries that were using the euro last year, lifting the bloc’s average to 85.1 percent of gross domestic product from 79.3 percent in 2009, the European Union’s statistics office in Luxembourg said today.

Greece’s deficit topped expectations and debt ballooned to 142.8 percent of GDP, the highest in the euro’s 12-year history. Ireland’s debt surged the most, by 30.6 percentage points to 96.2 percent of GDP.

“Greece should restructure sooner than later,” Lars Feld, a member of the German government’s council of economic advisers, said in a Bloomberg Television interview in Frankfurt before the figures were released today.

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