Spain to start reducing debt-to-GDP ratio in 2021
- Already in 2021 we expect that, thanks to the strong growth, we will be able to start reducing our deficit and our debt-to-GDP ratio.
- The budget deficit is likely to have reached the equivalent of 11.3% of GDP in 2020, a government forecast.
MADRID: Spain expects to start reducing its deficit and debt-to-GDP ratio in 2021, Economy Minister Nadia Calvino said on Thursday, following an expected economic rebound from last year's coronavirus-induced slump.
"Already in 2021 we expect that, thanks to the strong growth, we will be able to start reducing our deficit and our debt-to-GDP ratio," she told a business conference in Madrid.
The Spanish government expects the country's economy to bounce back in 2021 with growth of more than 7% following the more than the 11% contraction estimated for 2020.
In the third quarter Spain's debt-to-GDP ratio reached 114.1% from 97.5% a year earlier as spending rose dramatically to cushion the blow from the pandemic, while restrictions on business activity reduced revenue.
The budget deficit is likely to have reached the equivalent of 11.3% of GDP in 2020, a government forecast said, and is expected to narrow to 7.7% this year.
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