Europe’s corporate debt ranking reveals that companies in some of the continent’s smallest financial hubs have the highest levels of borrowing, with seven member states exceeding the European Commission’s warning threshold of 85% of GDP.
New Eurostat data show that corporate debt varies sharply across the European Union, with the countries where firms owe the most not being the ones you might expect.
The indicator compares the debt of non-financial corporations with each country’s gross domestic product, including bank loans and debt securities such as corporate bonds, while excluding banks, insurers, and other financial institutions.
Corporate debt stood at 70.1% of GDP at the end of 2025, with the ratio slightly higher at 71.6% within the eurozone.
Strong nominal economic growth in recent years has outpaced the increase in corporate borrowing, resulting in figures close to their lowest level in almost twenty years.
The European Commission uses an 85% of GDP threshold as part of its Macroeconomic Imbalance Procedure, introduced after the global financial crisis and the eurozone sovereign debt crisis as an indicator of potentially excessive private-sector borrowing.
Crossing the threshold does not automatically signal financial distress or trigger sanctions, but instead prompts the Commission to assess whether high debt reflects genuine economic vulnerabilities or structural factors that inflate the statistics.
The seven European countries with the highest corporate debt are Belgium, France, Netherlands, Cyprus, Sweden, Denmark, and Luxembourg.
Belgium’s position is largely the result of its long-standing role as a base for multinational companies managing internal financing.
Related: Google ordered to pay PriceRunner €1.7B over search abuse
France has a corporate debt ratio of 91.6% of GDP, which is generally regarded as a genuine macroeconomic issue rather than a statistical artefact.
The Netherlands owes much of its high ranking to its role as an international financial centre.
Cyprus follows a similar pattern on an even larger scale.
Four of the countries at the top of the ranking – the Netherlands, Cyprus, and Belgium – are relatively small economies, and their role as international financial hubs explains their high corporate debt ratios.
These countries host thousands of holding companies and financing vehicles used by multinational corporations to manage investments and internal funding across borders.
Although these entities often have limited economic activity in the host country, they are classified as non-financial corporations in official statistics, inflating the headline ratios.
In reality, the figures reveal as much about where multinational corporations choose to organise their finances as they do about borrowing by domestic businesses.
Once the effect of international financing centres is stripped out, the picture changes considerably, with France emerging as the notable outlier: the only major European economy combining both high public debt and raised corporate indebtedness, with its central bank considering corporate leverage to represent a real macro-financial vulnerability.
This disparity highlights the complexity of corporate debt in the European Union and the need to consider the specific circumstances of each country when assessing its debt levels, particularly in countries like France, which faces unique economic challenges.