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Eurozone debt rises sharply: Eurostat

AFP

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Eurozean public debt -- the accumulated total of government budget deficits and borrowing -- rose sharply earlier this year, reversing a downtrend when the economic crisis eased, official figures showed on Tuesday.

The 28 European Union states are supposed to keep total public debt below the equivalent of 60 percent of annual economic output, while annual budget deficits must not exceed 3.0 percent.

For years however these limits have been breached and total debt increased sharply during the crisis as governments borrowed even more to bolster their economies.

The result is that total debt in the 18 eurozone countries rose to 93.9 percent of gross domestic product in the first three months of 2014, up from 92.7 percent in the fourth quarter 2013.

In the full 28-member EU, total debt rose to 88 percent from 87.2 percent, the Eurostat statistics agency said.

Eurostat gave no explanation for why the figures increased in the first quarter.

Debt had fallen in both the third and fourth quarters of last year as the economy recovered slowly from a deep recession, boosting government revenues as spending was kept under control.

On that basis, some countries such as twice-bailed out Greece and struggling France, have called for an easing in the austerity policies adopted to tame the crisis, but Tuesday's figures may give pause for thought in doing so.

Among those with the highest total debt levels were Greece on 174.1 percent of annual output, Italy 135.6 percent and Portugal 132.9 percent, levels which many analysts believe make full repayment an unlikely prospect.

The best performers were Estonia with 10 percent and Bulgaria, 20.3 percent.

Date created : 2014-07-22