Spain’s public debt has surged to a new record of €1.729 trillion, according to data released Friday by the Bank of Spain, marking an increase of €66 billion compared to the same period last year. The 4% annual rise underscores the continued growth of government borrowing under the administration of Prime Minister Pedro Sánchez, even as officials highlight a decline in the debt-to-GDP ratio.
The Bank of Spain’s report shows that the total debt of all public administrations reached €1.729 trillion by the end of May 2026. This represents a significant jump from the €1.663 trillion recorded in May 2025. Despite this absolute increase, the government has pointed to a reduction in the debt-to-GDP ratio, which fell to 100.2% from 102.2% a year earlier. However, the European Commission has demanded that Spain keep its debt below 100% of GDP, a target that remains unmet.
The largest contributor to the debt is the central government, whose obligations rose by 4.4% year-on-year to €1.575 trillion, equivalent to 91.2% of GDP. Social Security debt increased by 7.9% to €136 billion, while regional governments saw a 2.1% rise to €343 billion. Only local administrations managed to reduce their debt, cutting it by 9.4% to €21 billion.
Since the end of 2025, total public debt has grown by €31.2 billion, with the central government accounting for €26.1 billion of that increase. Regional governments added €1.4 billion, and local administrations contributed €300 million. The Bank of Spain also noted that all major financing instruments recorded increases: short-term debt rose 9.3%, long-term loans increased 5.6%, and long-term debt securities grew 3.4%, indicating a sustained reliance on borrowing.
The rising debt comes as the government continues to celebrate positive economic indicators, but the data paints a more complex picture. While nominal economic growth has helped reduce the debt-to-GDP ratio, the absolute volume of debt continues to climb, raising concerns about fiscal sustainability. The European Union’s fiscal rules require member states to keep debt below 60% of GDP, with a stricter threshold of 100% for countries under excessive deficit procedures. Spain’s ratio, though improved, remains above that benchmark.
Economists warn that the persistent increase in public debt could limit the government’s ability to respond to future crises, such as economic downturns or natural disasters. The reliance on short-term borrowing, which grew by 9.3%, also exposes the state to interest rate fluctuations. The Bank of Spain’s report highlights that the debt increase is broad-based, affecting all levels of government except local councils.
The government has defended its fiscal record, arguing that the reduction in the debt-to-GDP ratio demonstrates progress. However, critics point out that the absolute debt level is at an all-time high and continues to grow. The European Commission’s demand for a sub-100% ratio remains a key challenge, as Spain’s debt is still above that threshold despite the recent decline.
In a separate development, the judicial situation of former Catalan president Carles Puigdemont remains unresolved, with the Supreme Court maintaining an arrest warrant against him. Transport Minister Óscar Puente has urged Puigdemont to return to Spain, arguing that the European Court of Justice’s backing of the amnesty law should allow his return. However, the Supreme Court insists that the crime of embezzlement is not covered by the amnesty, leaving Puigdemont’s legal status uncertain. The Constitutional Court is expected to rule on related appeals, which could clarify the application of the amnesty law.