Although state debt is still rising, extremely low interest rates are keeping the cost of public borrowing down. According to De Standaard on Wednesday, Belgium will have to pay 1 billion euros less in interest this year, all of which will be used towards paying back the initial debt.
The Debt Agency has calculated interest on current state debt will be 10.65 billion euros. This figure is 300 million euros less than government expectations, almost 1 billion euros lower than in 2014 and 1.7 billion euros less than three years ago.
Yet, debt hasn’t actually gone down, quite the opposite. According to the National Bank, the sum owed by the government totals 106.9% of GDP, which is 20 percentage points higher than in 2007 (86.9%), before the economic crisis hit. Belgium is currently taking advantage of the low interest rates set by the Central European Bank and which are affecting state bonds.
Although the Debt Agency figures are only estimates, it is unlikely they will be far from the mark when the actual figures are released, said the newspaper.