Spain’s public sector finished 2023 with total indebtedness of 1.574 trillion euros, the highest year-end in the series and equal to 107.7% of GDP, down 3.9 percentage points from 2022.
According to data released by the Bank of Spain on Friday, the public debt rose by 71.878 billion euros in 2023, an increase of 4.8% from 2022. Despite the absolute rise, the December end-of-year debt-to-GDP ratio remains well below the pandemic peak of 2020, which stood at 120.3% of GDP.
Moreover, December’s figure places the debt 0.4 percentage points below the government’s full-year target of 108.1% of GDP.
In a video sent to media outlets, the Economy Minister, Carlos Cuerpo, underscored that debt has again fallen in Spain thanks to the economy’s solid performance and the government’s commitment to prudent public finances. He noted that this is the third consecutive year of debt-reduction projections exceeding expectations and that the current level is already 17 points below the pandemic peak.
For 2024, the government expects the downward path to continue, aiming to finish the year at 106% of GDP, demonstrating that fiscal responsibility supports sustainable and fair growth, according to Cuerpo.
Most of the debt is held by the State
As usual, the bulk of the debt in 2023 was held by the State, which closed the year at 1.414 trillion euros after adding 82.882 billion during the year, a 6.2% rise.
Autonomous communities increased their indebtedness by 8.384 billion (2.6%), bringing it to 325.474 billion, while local corporations added 244 million (1.1%), ending the year at 23.299 billion.
Social Security finished 2023 with debt of 116.173 billion, up 9.995 billion from the previous year, a rise of 9.4%.
By instruments, most debt was settled in securities (1.397.719 billion), mostly long-term (1.326.054 billion), but also short-term (71.665 billion). The rest was distributed among loans (171.677 billion) and cash and deposits (5.286 billion).
Influence and interpretation: the latest data underscore a broad pattern of consolidation in public finances, with the central government issuing most of the debt and debt levels still above pre-crisis norms, yet showing resilience amid macroeconomic stabilization efforts. These dynamics are closely watched by analysts for implications on sovereign credit risk, public investment capacity, and social welfare funding. (Banco de España) and government fiscal policy reports provide ongoing context for these figures.