In the first six months of 2004 the financial position of Dutch central government continued to deteriorate. Debts increased more than claims and as a consequence the balance decreased by 10 billion euro. The decrease comes after a year in which the Dutch government’s financial position was already seriously deteriorating.
Balance of government debts and claims
Government deficits are usually financed by borrowing money and thus creating new debts often government bonds or treasure bills. These securities make up about 90 percent of total government debts.
The value of government bonds and treasure bills rose by 5 illion euro in the first six months of 2004. The quoted value of government bonds amounted to 195 billion euro by the end of June 2004, treasure bills amounted to 26 billion euro.
Other public debts amounted to 27 billion euro by the end of June.
Government claims largely consist of shares and profit shares in large corporate structures like KPN, TPG, NS and foreign development banks. At the end of June 2004 the value of shares and profit shares amounted to 40 billion euro. The value of quoted shares declined in recent years because part of the shares were sold and prices fluctuated on the market.