The fiscal deficit continues to shrink and is expected to be lower than targeted by the government in 2015. Public debt is declining but remains high at around 110% of GDP and makes Ireland vulnerable to international shocks. The government should lock in the decline in debt by aiming for budget balance.Read more
The budget deficit has been eliminated and debt levels have begun to fall. Legislating fiscal rules and introducing a fiscal council would help lock in the progress in achieving debt sustainability.Read more
Austria is well on track to meet its structural deficit objectives. On the other hand, public debt has risen strongly over recent years due to state aid provided to rescue troubled banks and the level of public guarantees is the highest of the EU.Read more
Debt targets can serve as a fiscal policy anchor to ensure the sustainability of fiscal policy and that there is sufficient policy room to cope with adverse shocks. Prudent debt targets provide the commitment tool that re-assures markets and thereby diminishes risk premia and the cost of active fiscal policy.