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Concepts and definitions

Consolidated financial balance/flows

Financial assets and liabilities can be presented in consolidated form, i.e., after elimination of intra-sectorial transactions within sub-sectors (e.g. debts between municipalities) and between sub-sectors (including municipalities' debts to the state, employment pension corporations and other social security institutions within the general government sector). Consolidated data only show the relative positions of the sectors.

ESA 2010

ESA 2010 = European System of Accounts 2010, the EU's revised Regulation that steers the compilation of economic statistics.

General government debt

General government debt is general government sector consolidated gross debt valued at nominal value, and it is also known as EDP debt (= Excessive Deficit Proce-dure).

It comprises bonds, short-term securities, short-term and long-term loans and deposits received by general government from other sectors of the national economy or from the rest of the world. The EDP debt concept used in reporting according to the European Union's Growth and Stability Pact differs from that of ESA 2010 with regard to valuation and coverage. Finan-cial assets and liabilities are valued at market value in ESA 2010-compliant financial accounts, whereas general government EDP debt is valued at nominal value. Of the financial claims in ESA 2010, for example, deriva-tives, trade credits and advances are not included in the loan stock.

General government deficit

General government deficit also called EDP deficit (= Excessive Deficit Procedure), corresponds with the general government net lending/borrowing in the national accounts.

Gross debt

Financial assets have no impact on total gross debt.

Net lending/net borrowing

Net lending/borrowing is a balancing item in the capital account and the fi-nancial account.

Net lending/borrowing corresponds to the amount available to a unit or sec-tor for financing, directly or indirectly, other units or sectors, or the amount which a unit or sector is obliged to borrow from other units or sectors.

The corresponding concept to net lending/borrowing in financial accounts is financial transactions, net. It is the difference between net acquisition of fi-nancial assets and liabilities. If a sector acquires financial assets in excess of the amount of new debt incurred during the period it is a net lender.

Non-consolidated financial balance/flows

Financial assets and liabilities can be presented in non-consolidated form, i.e. all transactions are shown in full, including intra-sectorial and intra-sub-sectorial transactions. Intra-sectorial transactions in sectors consisting of a single institutional unit are nevertheless eliminated (e.g. borrowing within the central government sector). Intra-sectorial transactions do not have any impact on the sector's net worth or net lending.