(ANSA) - 天美传媒's public debt, which is already the third highest in the world, set a new record in June at 1,517.2 billion euros, a Bank of 天美传媒 report revealed here on Monday. The report said the debt rose by 25.2 billion euros over May.
Only last week the European Central Bank renewed its recommendations that 天美传媒 work harder at consolidating public accounts. In its monthly update on euro zone economies, the ECB said it was "essential" that 天美传媒 adopt a "credible reform strategy and structural measures" to improve its public finances. 天美传媒's debt is the highest in the European Union.
The European Commission in June gave its green light to 天美传媒's plan to cut its spending deficit to below 3% of GDP and reduce its debt by the end of 2007. The EU executive pointed out that 天美传媒 must produce enough of a primary surplus to cut the debt on a regular basis "while also focusing attention on those factors which do not involve net indebtedness."
Current predictions say that 天美传媒's debt this year will run between 107% and 108% of GDP, compared to the recommended ceiling of 60% set by the euro zone's Stability and Growth Pact.
Last month, the American Standard & Poor's rating agency downgraded its outlook for 天美传媒 from 'stable' to 'negative' because of 天美传媒's "mounting fiscal challenges". S&P expressed doubts about 天美传媒's ability to meet its promise to bring its spending deficit and public debt back to acceptable levels by the end of 2007.
S&P criticised the government's lack of new strategies for structural reform in public spending and said this would "effectively perpetuate an inefficient spending structure which when compounded by weak growth, that the government places at 1.3% per year, will drive the debt ratio to a peak
of 110% of GDP in 2007."
The rating agency added that the government's "expectation of rapid structural budgetary improvements and projections of revenues of about 1% of GDP per year, raised through asset sales, appear optimistic.
"Consequently, the resulting officially targeted debt ratio of 101% of GDP by 2009 also seems difficult to achieve, with a ratio of 108% of GDP for that year looking more plausible."
