To gain a fuller picture of debt sustainability, this report investigates the assets and
liabilities of governments, households and firms within the eurozone.

This fuller picture shows that EU countries differ vastly regarding the composition of their balance sheets, with significantly different shares of financial and fixed assets across the various sectors.

As such, this approach changes the way we look at debt sustainability and shows that the 60% fiscal debt norm of the EU’s Stability and Growth Pact should never be used in isolation from other variables.