2023-08-27 02:21:58
Debt has two very different faces in Spain: that of public administrations and that of the private sector. The first, that of the State, autonomous communities and local corporations, does not stop growing. According to the latest data, made public at the end of last week by the Bank of Spain, the liabilities of the Spanish public administrations as a whole reached 1.568 trillion euros in June, a new all-time high, after growing by more than 1.7%. in monthly rate. The Spanish public debt has had an increase of 6.4% compared to June last year, with 93,763 million more, in a context of greater spending due to the measures adopted by the administrations to alleviate the impact of the war in Ukraine. To this is added, in addition, the significant effort that they also had to make to face the economic effects of the pandemic, which has caused an increase of 345,000 million euros since 2019.
Faced with the still unrestrained increase that public debt continues to register in absolute terms -in proportion to GDP, it remains around 113% due to the growth of the economy-, in recent months the private sector has begun to tighten its belt to face the increase in financing costs derived from the successive increases in interest rates approved by the European Central Bank (ECB) to contain the rise in inflation.
Debt as a percentage of GDPqAntonio CruzLa Razón
Families and companies reduced their debt by 28,428 million euros to a total of 1.92 trillion in the first quarter of the year, equivalent to 140.9% of GDP (146.6% at the end of 2022). In consolidated terms (discounting the debt between companies), private debt stood at 121.1% (125.4% previously). As explained by CaixaBank Research in their document “In Spain, the deleveraging of households and companies continues”, it is necessary to go back almost twenty years, to the second quarter of 2003, to find a lower ratio.
families
Families reduced their debt in the first quarter of the year by 7,866 million euros (1.1% less), to 694,938 million euros, an amount that represents 51.1% of GDP, two points less than in the quarter and the best record since 2002. As a result of the interest rate rises, households continued the trend that began in the second half of 2022 and used the greatest savings accumulated in the period to repay bank loans, allocating 7,268 million euro. As explained by CaixaBank Research, this is the most negative flow in a first quarter since 2014 and contrasts with the positive intake in the first quarter of 2022 (443 million euros, thus exceeding the average for the same period of 2014-2019 (-4,956 million ).
Regarding the net acquisition of financial assets by households, in the first quarter of 2023 it was negative (-5,468 million euros), something that had not happened in a first quarter since 2017. Basically, households reduced cash ( -1,442 million euros compared to -2,719 million on average in the 2014-2019 period) and, above all, bank deposits (-20,776 million compared to -941 million). On the other hand, families invested 9,534 million and 9,518 million in debt securities and equity and investment funds, respectively.
The negative acquisition of household assets was largely offset by an intense revaluation of these (34,897 million euros), mainly due to the improvement in the prices of shares in capital and investment funds, so that the “stock” of assets Gross financial households grew by 29,357 million euros, up to a total of 2.75 trillion.
Companies
With regard to companies, the net debt contracted by non-financial companies (in consolidated terms) fell in the first three months of the year by 9,468 million euros, the largest amortization in a first quarter since 2014 (compared to the decrease of 603 million in the first quarter of 2022 and the 2,121 million average increase between 2014 and 2019). If a slight increase in the prices of the fixed-income securities issued is discounted, together with other variations in volume, the balance of the consolidated debt of companies contracted by 8,116 million euros (-0.8%) to a total of 952,696 million. In terms of GDP, it is equivalent to 70%, the lowest ratio since the third quarter of 2003.
Regarding the financial assets of companies, they barely increased slightly in the first quarter by 7,181 million euros (up to 3.03 trillion), a figure that improves on that of a year earlier (-76,766 million), but which remains far behind. below the average for the 2014-2019 period (51,565 million euros). This increase in the balance of assets is fully explained, according to CaixaBank Research, by the strong revaluation noted (37,600 million), especially in shares and investment funds, since the net acquisition of assets was negative (-30,724 million). Something that, according to this research department, has been common in recent years in the first quarter: companies reduced assets materialized in commercial credits, loans and, above all, cash and deposits.
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