The EU Fiscal Risk Matrix – from government debt to climate liabilities

Abstract

The aim of the article is to identify the main components of government overall liabilities based on the Fiscal Risk Matrix classification introduced by the World Bank in 1999, and to estimate the amount and structure of these liabilities in European Union countries (EU Fiscal Risk Matrix). The climate liabilities definition and methodology included in the EU Fiscal Risk Matrix is also a novelty of the research. The study covered EU member states in the period 2018–2019, taking into account available data from the Eurostat database. On this basis, the EU Fiscal Risk Matrix was developed with the estimated structure of the burden of government liabilities for individual countries and the EU as a whole. The article used statistical and comparative analysis. The major conclusion of our research involves the proposal to implement a unified European methodology of government overall liabilities classification based on the EU Fiscal Risk Matrix to assess the fiscal debt burden and transparency of fiscal policy.