Notification of government deficit and debt - 2023 (Second notification, data sent to Eurostat)
Balance of the general government sector for 2023 ended up in deficit
Publication Date: 02. 10. 2024
Product Code: 050062-24
“Compared to the spring notification, the balance of the general government sector in 2023 worsened by 0.1 p. p. and ended up with a deficit of 3.8% of the GDP, mainly as a result of updated information on the corporate income tax. The relative level of debt declined to 42.4% of GDP,” Helena Houžvičková, Director of the Government and Financial Accounts Department of the Czech Statistical Office (CZSO), stated.
The balance of the general government sector in 2023 has been revised compared to the notification from April 2024 by -CZK 19.7 bn. Not only the central government sector balance worsened (-CZK 13.2 bn); the local government sector balance worsened, too (-CZK 7.2 bn). The reduction in the deficit was mainly caused by updated data on corporate income tax.
Table 1: Notification table of government deficit and debt, the Czech Republic, 2020–2023
Unit | Year | ||||
2020 | 2021 | 2022 | 2023 | ||
Net borrowing/lending of general government | CZK mil. | -329 285 | -312 308 | -216 345 | -288 082 |
General government consolidated gross debt | CZK mil. | 2 149 655 | 2 566 752 | 2 997 632 | 3 234 002 |
Net borrowing/lending of general government as % of the GDP | % | -5.6 | -5.0 | -3.1 | -3.8 |
General government consolidated gross debt as % of the GDP | % | 36.9 | 40.7 | 42.5 | 42.4 |
The total general government sector revenue increased in 2023 by 8.6%, y-o-y; in absolute terms, it was an increase by CZK 241.9 bn. Revenues from social contributions and from income taxes were increasing the most.
The total general government sector expenditure increased in 2023 by 10.3%, y-o-y, i.e. by CZK 313.7 bn. The highest increase was recorded for social benefits paid, subsidies, and compensation of employees paid.
In the end of 2023, the relative debt of the general government reached 42.4% of the GDP. In the year-on-year comparison, the relative indebtedness decreased by 0.1 p. p. An increase in the nominal GDP contributed to a decrease of the relative amount of the debt (-3.2 p. p.), whereas the nominal amount of the debt increased in relation to the GDP by 3.1 p. p.
Compared to the spring notification, the amount of the debt has been revised for received loans (+CZK 5.6 bn). In the end of 2023, the general government debt reached CZK 3 234.0 bn. Major part of it consists of issued debt securities.
Indicators presented in the Table 1 were transmitted to Eurostat on 30 September 2024.
Notes
Notification of government deficit and debt is compiled always for the past four years and submitted to the European Commission by each Member State of the European Union always at the end of March and September each year, including a projection for the current year. The projection for the current year is compiled and published by the Ministry of Finance of the Czech Republic. Quantification of fiscal indicators is based on the ESA 2010 methodology and serves the assessment of how the Maastricht convergence criteria are complied with. Pursuant to the Maastricht criteria, the government deficit must not exceed 3% of the GDP and the level of the accumulated government debt must not exceed 60% of the GDP.
Government surplus/deficit is represented by the item B.9 “net borrowing (−) or net lending (+)” in the system of national accounts. The indicator refers to the ability of the general government sector in the given year to finance other sectors of the economy (+) or the need of the general government sector to be financed (−) by other sectors.
The government debt consists of consolidated liabilities of the general government sector in the form of currency and deposits, issued debt securities, and received loans. In case of foreign exchange debt instruments hedged against currency risk, value in CZK is obtained by means of a contractual exchange rate.
Responsible head at the CZSO: Helena Houžvičková. Director of the Government and Financial Accounts Department, phone number: (+420) 704 688 734, e-mail: helena.houzvickova@csu.gov.cz
Contact person: Jaroslav Kahoun, Head of the Government Accounts Unit, phone number: (+420) 274 054 232, e-mail: jaroslav.kahoun@csu.gov.cz
The next news release will be published on: 22 October 2024
This press release was not edited for language.