In 2023 general government budget deficit amounted to 2.4 % of GDP

Provisional results (accordingly European System of Accounts (ESA 2010) methodology) compiled¹ by the Central Statistical Bureau (CSB) show that in 2023 general government budget deficit amounted to EUR 932 million or 2.4 % of the GDP and, compared to 2022, that was EUR 822 million less. General government consolidated gross debt accounted for EUR 17.6 billion or 45.0 % of the GDP and during a year it has increased by EUR 1.54 billion.

General Government Budget Deficit or Surplus and Debt

	2020	2021	2022	2023
Budget deficit (-) / Surplus (+), million EUR
General government	-1 194.5	-2 331.1	-1 753.6	-931.7
Central government	-1 315.9	-2 482.8	-1 997.0	-1 076.0
Local governments	-44.6	-90.2	+20.6	-143.5
Social security fund	+166.0	+241.9	+222.8	+287.8
General government budget deficit as % of GDP	4.1	7.2	4.9	2.4
Consolidated gross debt at nominal value at the end of the year, million EUR²
General government	12 869.5	14 809.8	16 038.9	17 578.5
Central government	13 680.3	16 017.6	17 653.6	19 403.2
Local governments	2 133.4	2 253.1	2 323.9	2 334.3
General government consolidated gross debt at nominal value at the end of the year as % of GDP	44.0	45.9	44.4	45.0

In 2023 general government revenues, compared to 2022, went up by 14.4 % and reached EUR 16.3 billion, but expenditure – increased by 7.7 % and reached EUR 17.2 billion, of which EUR 0.4 billion were expenditure on support measures to compensate the increase in energy resource prices.

As compared to operating cash flow data indicated in the annual report of the Ministry of Finance, where consolidated budget deficit in 2023 was EUR 1.3 billion, budget deficit calculated by the CSB in accordance with the methodological requirements of European System of Accounts 2010 is EUR 398.3 million or 1.0 percentage point of GDP less.

Most significant methodological adjustments with positive effect (reduces budget deficit) on the general government budget:

adjustments to claims against debtors (data of the Treasury) – by EUR 377.4 million or 1.0 % of GDP;
adjustments for balancing foreign financial aid flow (data of institutions involved in administration of foreign funds) – by EUR 162.0 million or 0.4 % of GDP;
adjustments to Recovery and Resilience Facility and Modernisation Fund (data of the Treasury) – by EUR 147.7 million or 0.4 % of GDP;
adjustments for paid interest (data of the Treasury) – by EUR 39.7 million or 0.1 % of GDP;
adjustments for retained contribution into the Single tax account (data of the Treasury) – by EUR 38.8 million or 0.1 % of GDP;
balance of the Deposit Guarantee Fund (data of Latvijas Banka) – by EUR 27.5 million or 0.1 % of GDP.

At the same time, there have also been adjustments with negative effect (increases budget deficit) on the general government budget, of which the most significant are:

balance of central and local government reclassified enterprises to general government (CSB data) – by EUR 162.9 million or 0.4 % of GDP;
adjustments between accrued and paid interest (data of the Treasury) – by EUR 71.8 million or 0.2 % of GDP;
adjustments to obligations against creditors (data of the Treasury) – by EUR 67.5 million or 0.2 % of GDP;
adjustments for future payments of the 2nd pillar pension scheme funds (data of the State Social Insurance Agency) – by EUR 34.0 million or 0.1 % of GDP;
tax adjustments by using the time adjustment method (data of the Ministry of Finance) – by EUR 32.5 million or 0.1 % of GDP.

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In 2023, compared to 2022, general government debt has risen by EUR 1.5 billion and reached EUR 17.6 billion or 45.0 % of GDP. In 2023 rise in general government debt was affected by the issuance of three new Eurobonds.

Eurostat will release information on the results of the October 2024 notification in all EU Member States on 22 October.

Methodological information

Due to the benchmark revision, the previously published general government budget deficit and debt data for 2020-2023 have been revised. Benchmark revision incorporates methodological changes related to work on action points set by Eurostat, the statistical office of the European Union, both in the framework of verification cycle of GNI own resources and in the framework of general government excessive deficit procedure. Other minor changes have been made to the methodology and data sources used. Recalculation of the GDP data time-series, reclassification of eight institutional units to the general government sector, revision of the assessment principles for certain production and product taxes and additional adjustments related to the derivative of the Riga Municipality have been made.

While carrying out calculations of the October 2024 notification, data of the Ministry of Finance, the Treasury, State Social Insurance Agency, CSB, Riga City Council, Latvijas Banka, State Revenue Service and institutions involved in administration of foreign funds were used.

¹ The results of the Notification are used for assessing how the EU Member States observe the compliance of the respective economic indicators with the criteria established by the Maastricht Treaty, that is, the ratio of the planned and actual general government budget deficit to the GDP at current prices must not exceed 3.0 % and the ratio of the government debt to the gross domestic product at current prices must be no more than 60.0 %.

² Consolidation was carried out in each sub-sector but not across the sub-sectors.

Media requests:
Communication Section
E-mail: media@csp.gov.lv
Phone: +371 27880666

More information on data:
Vija Veidemane
Government Finance Section
E-mail: Vija.Veidemane@csp.gov.lv
Phone: +371 67366963