Liabilities of public corporations reach 74.8% in Cyprus for 2017

Greece (119.6% of GDP), the Netherlands (102.7%), Germany (91.7%), Luxembourg (82.5%) and Cyprus (74.8% , 0.0% is non performing) are the countries with the highest level of liabilities of public corporations, according to data released today by Eurostat, the statistical service of the EU.

The main reason for the high level of these liabilities is that the data include government controlled financial institutions, among other public banks.

Most of these liabilities consist of deposits held in these public banks by households or by other kinds of private or public entities. It should be noted that, in general, financial institutions report high amounts of debt liabilities, however they also have, at the same time, significant level of assets, which are not captured in this data collection. At the opposite end of scale, overall small amounts of these liabilities are recorded in Slovakia (5.7% of GDP), Romania (6.7%), Lithuania (6.8%) and Croatia (9.9%). Most of these countries have negligible liabilities related to financial institutions, even below 1%, as in Lithuania (0.1%) and Slovakia (0.3%).

Eurostat published data on contingent liabilities and non-performing loans of EU governments for the year 2017, that may become actual debt if certain conditions prevail. 

This publication includes data on government guarantees, liabilities related to public-private partnerships recorded off-balance sheet of government and liabilities of government-controlled entities (public corporations) classified outside general government. Contingent liabilities are only potential liabilities.

The highest rates of government guarantees were recorded in Finland (32.0% of GDP) and Austria (15.8%) followed by Germany (13.3%) and Luxembourg (12.2%). The lowest shares, with less than 1%, were noted in Slovakia (0.02%), the United Kingdom and Czechia (both 0.2%), Bulgaria (0.3%) and Ireland (0.5%). In Cyprus the same rate is 8.7%.

In most EU Member States, the central government is the biggest guarantor, except in Sweden, Denmark and Czechia, where levels of local government guarantees are higher than of central government. In several countries - Belgium, France, Hungary, Ireland, Luxembourg and Spain - a major part of the guarantees is towards financial institutions and were often granted by government in the past in the context of the financial crisis.

In all EU Member States, liabilities related to off-balance public-private partnerships (PPPs), which are long-term construction contracts where assets are not recorded in government accounts, were below 3% of GDP. Slovakia had the highest share (2.9% of GDP), followed by Portugal (2.7%), Hungary (1.5%) and the United Kingdom (1.4%). For 2017, ten countries reported no liabilities related to off-balance PPPs: the Netherlands, Bulgaria, Czechia, Germany, France, Luxembourg, Poland, Romania, Slovenia and Sweden. In Cyprus the same rate stands at 0.7.