The slowdown in economic growth in the eurozone is having negative consequences for government finances in the eurozone countries. In a few countries, government deficit even exceeds the maximum permitted 3 percent of gross domestic product (GDP). In the Netherlands the government deficit will enter the danger zone in 2004, at 2.4 percent of GDP.
Government surplus/deficit 2002 and 2003
Government debt no longer shrinking
The consequences of the economic slowdown are reflected in a stabilisation of government debt. For the Netherlands, the Netherlands Bureau for Economic Policy Analysis (CPB) expects this debt – also in terms of a percentage of GDP - to fall slightly this year. For 2004 the bureau foresees a small increase.
This will put and end to the decrease in Dutch government debt which started in 1993. Since then it has fallen from 81 percent to 53 percent of GDP in 2002.
Government debt 2002 and 2003