BRUSSELS (Reuters) - The European Union’s total government debt rose slightly to 82.2 percent of economic output in the third quarter of 2011, the EU’s statistics agency said on Monday, lower than the United States but still a burden that could take decades to pay down.
For the euro zone, government debt fell slightly to 87.4 percent of gross domestic product, compared with the 87.7 percent level at the end of the second quarter of last year.
The 27-nation’s EU’s debt stood at 81.7 percent in the second quarter, Eurostat said in the first release of such data, as the bloc steps up the monitoring of its debts and tries to prevent any recurrence of the two-year sovereign debt crisis.
In comparison, U.S. debt-to-GDP hit 100 percent in 2011 and under its current trajectory would exceed 115 percent of GDP by 2016, according to International Monetary Fund figures.
Europe’s debts soared after the introduction of the euro in 1999 as countries indulged in massive borrowing at very low rates of interest. But with economic growth stalling, the EU faces very slow progress in lowering the debt burden, even as it cuts spending across the bloc to bring down its fiscal deficits.
The World Bank said last month that Europe’s debts may not reach manageable levels until 2030. That could potentially erode Europe’s leadership in the world, while less-indebted emerging countries expand their economies and their influence.
Only 13 EU members had debts below the 60 percent limit set by the European Commission and that the bloc judges to be the maximum for a healthy economy, although indebtedness varied widely. Just four of those were members of the 17-nation single currency area.
Tiny Estonia had a debt-to-GDP ratio of 6 percent in the third quarter, compared with 159.1 percent in Greece.
France and Britain both had a level of 85.2 percent and even Germany, the bloc’s biggest economy that is driving EU austerity efforts, was at 81.8 percent in the July to September period.
Reporting By Robin Emmott. Editing by Jeremy Gaunt.