El Salvador: Public Debt Reaches 59% of GDP

In July, the public debt balance reached $14.57 billion, the highest in Central America in relation to GDP.

Monday, September 2, 2013

Elmundo.com.sv reports that "in the first half of the year, the ratio of public debt in El Salvador in relation to its Gross Domestic Product (GDP) was the highest in Central America, according to the Central American Monetary Council (CAMC)" .

Compared to the same period in 2012, the ratio has increased by 2.6%. Salvadoran debt was higher than the 5.4% held by Costa Rica, the country with the second highest percentage in Central America with a debt ratio of 53.2% of GDP.

Third place went to Honduras with 50.4% of its GDP, followed by Nicaragua with 48.4%. The CMCA has no data for Panama but the Ministry of Economy and Finance (MEF) stated that the debt reached 42.5% which would give it fifth place followed by Guatemala with 27.9%.

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Honduras Government Debt Reaches 50% of GDP

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The Central American Institute for Fiscal Studies has carried out an assessment of the public finances 2010-2013, and prospects for 2014.

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Panama’s Debt / GDP Ratio Still Falling

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Despite the increase in the public debt exceeding $14.5 billion, GDP growth has brought the relationship between the two parameters to less than 40%.

The strong growth of the Panamanian economy both during the Torrijos administration and the current one of Ricardo Martinelli, has seen the relationship between public debt and gross domestic product (GDP) go from 70.4% in 2004, to 39.6% according to the Ministry of Economy and Finance (MEF) as at the end of 2012.