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PUBLIC FINANCES

Public debt passes 20,000 euros per capita for first time

State indebtedness reaches almost 90 percent of GDP

As a result of the deficit amid Spain’s second recession in only four years and the impact of a European bailout for the banking sector, the country’s outstanding public debt in May hit the equivalent of 20,000 euros per inhabitant for the first time ever, according to figures released Wednesday by the Bank of Spain.

The central bank said the indebtedness of the public sector climbed by 23.349 billion euros from April to a new record of 937.334 billion euros, equivalent to 89.6 percent of GDP. Dividing that figure by the 46.704 million people living Spain, according to a census carried out at the start of the year by the National Statistics Institute, every resident of the country owes 20,060 euros.

Since the government of Prime Minister Mariano Rajoy took power a year and a half ago, public debt has risen by some 200 billion euros, or 20 percent of GDP, an increase of the same magnitude during the eight years Rajoy’s predecessor, Socialist José Luis Rodríguez Zapatero, was in charge. However, Zapatero’s first mandate did include a period when the domestic economy was still booming and generating public surpluses.

The Rajoy administration expects debt to climb to 91.4 percent of GDP by the end of this year, a figure in line with the IMF’s estimate of 91.8 percent. However, the IMF expects debt levels to continue to rise before peaking at 110 percent of GDP in 2018.