Germany cuts debt as economy gains momentum

Berlin (dpa) - Germany reduced its mountain of public debt last year after the solid performance of Europe‘s biggest economy resulted in higher tax revenues, the nation‘s central bank said on Friday.The Frankfurt-based Bundesbank said the nation‘s debt level fell by 2.9 per cent last year to 68.3 per cent of gross domestic product (GDP).The fall resulted the national debt level edging down closer to 60 per cent of GDP, the target level set for euro member states under the EU‘s Maastricht Treaty.Government debt has now fallen by a total of 65 billion euros (70 billion dollars) after peaking in 2012.The decline in German debt adds to the rosy picture of the nation‘s public finances for Chancellor Angela Merkel‘s government in an election year.Official data released in January showed Berlin posted its third consecutive annual budget surplus last year, which came in at 0.6 per cent of GDP.This is also well below the budget deficit rule of 3-per-cent of GDP required for euro members.Finance Minister Wolfgang Schaeuble has said Berlin planned to use last year‘s 6.2-billion-euros federal government budget surplus to further dismantle debt and to strengthen the naion‘s public finances.The state of Germany‘s finances also stands in marked contrast to many of Berlin‘s eurozone partners that are struggling to meet the EU‘s fiscal targets.Releasing Friday‘s data, the Bundesbank said that the fall in debt reflected the budget surpluses run up by Germany‘s federal and state governments.However, the nation‘s regional governments were still burdened by heavy debt, the bank said.