According to recent data released by Statistics Finland, the general government debt in Finland experienced a notable increase of EUR 2.1 billion during the first quarter of 2023. The consolidated gross debt, measured at nominal prices, reached EUR 197.9 billion by the end of the quarter. In terms of GDP, the general government debt stood at 72.6 percent. Compared to the same period in the previous year, the general government debt has risen by EUR 12.6 billion.
The accompanying chart depicts the historical trend of general government debt by sub-sector since 2000. Notably, the central government debt has been steadily increasing since 2009, reaching EUR 164.1 billion at the end of the first quarter of 2023.
Key Points:
- Central Government Debt: The central government debt grew by EUR 3.5 billion during the first quarter, amounting to EUR 164.1 billion by the end of the quarter. The increase was primarily driven by the growth in long-term bond stocks by EUR 6.2 billion, while short-term debt instruments with a maturity of under one year decreased by EUR 2.3 billion. The total stock of short-term and long-term loans decreased by EUR 0.2 billion.
- Local Government Sector Debt: With the initiation of the wellbeing services counties’ activities in 2023, the local government sector underwent reforms. Consequently, the renewed local government sector’s debt decreased by EUR 1.0 billion in the first quarter of 2023. The stock of long-term loans decreased by EUR 0.2 billion, and the stock of short-term debt instruments with a maturity of under one year decreased by EUR 0.2 billion.
- Social Security Funds Debt: The debt of social security funds decreased by EUR 0.4 billion, primarily attributed to a decrease in short-term debts. At the end of the first quarter, the debt of social security funds amounted to EUR 3.5 billion.
It is important to note that general government EDP debt represents the debt of the general government to other sectors within the national economy and the rest of the world. The debt-to-GDP ratio provides insights into the country’s overall debt burden, taking into account seasonal and working day adjustments.
While the increase in general government debt raises concerns, further analysis is necessary to understand the implications for Finland’s economic stability and fiscal management.
https://www.stat.fi/en/publication/cl8n4eqdv3xg30cvzefv2isc8