The EU plans to support the European economy with a reconstruction fund of 750 billion euros. The international community wants to borrow the necessary money on the capital markets – the loaned amount is to be repaid jointly between 2027 and 2058.
In doing so, the EU is following the example of many member states who got into debt during the crisis in order to implement economic stimulus and rescue packages. Germany also suspended the debt brake for its own aid measures in March and passed two supplementary budgets – with a volume of 156 billion euros in March and 62.5 billion euros in June.
In ailing countries like Italy, however, the mountain of corona-related debt is now growing to a worrying size. Forecasts already anticipate a government debt ratio of 160 percent by the end of the year. By way of comparison: the last time the Italian government debt ratio was measured against economic output was 135 percent. By contrast, other countries had a particularly low government debt ratio before the crisis, according to the European statistical office Eurostat. They could also have an advantage in times of crisis due to their low debt levels.
These European countries have the lowest government debt ratios
@imago images / Rainer Unkel
# 10 Malta
According to Eurostat, Malta had a government debt ratio of 43.1 percent of gross domestic product (GDP) in 2019. That meant tenth place in the European Union. Malta was ahead of Poland (46.0 percent), Slovakia (48.0 percent) and the Netherlands (48.6 percent).
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# 9 Latvia
Latvia was in debt with only 36.9 percent of its GDP in 2019. This means that the national debt ratio of the Baltic country was only half the EU average. Compared to the other EU member states, that’s enough for ninth place.
# 8 Lithuania
Lithuania took eighth place with a national debt of 36.3 percent. This makes the country one of three places in the rankings whose national debt ratio has increased compared to the previous year. In 2018, the debt level here was 2.5 percent lower.
@imago images / robertharding
# 7 Romania
Romania’s government debt ratio was 35.2 percent of GDP in 2019. That was the seventh lowest value in the EU. Compared to the previous year, however, the debt level increased slightly and increased by half a percent.
# 6 Sweden
With a national debt ratio of 35.1 percent, Sweden ranks sixth just ahead of Romania. The Scandinavian country’s debt level has been falling for years. Compared to 2018, the national debt ratio fell by 2.7 percent.
@imago images / Dean Pictures
# 5 Denmark
According to Eurostat, Denmark’s national debt ratio was 33.2 percent of GDP in 2019. Compared to the previous year, it rose slightly by 0.7 percent.
# 4 Czech Republic
The Czech Republic’s national debt decreased compared to the previous year. In 2019, the country recorded a national debt ratio of 30.8 percent – and thus almost two percent lower than in 2018.
@imago images / photonews.at
# 3 Luxembourg
Luxembourg had the third lowest government debt ratio in 2019. It was 22.1 percent. In 2018, however, the value was even lower at a rate of 21 percent.
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# 2 Bulgaria
Bulgaria was in second place in the EU with a national debt ratio of 20.4 percent. This meant that the country was clearly removed from the front runner in the international community.
@imago images / ITAR-TASS
# 1 Estonia
Estonia has by far the lowest national debt ratio of the EU member states. According to Eurostat, it only added up to 8.5 percent of GDP in 2019. Germany was in the middle with 59.8 percent. The rate was at least ten percentage points below the value in 2016.