When the politicians and mandarins plotted the evolution of the Euro at the end of the previous century, there was one very specific stipulation for countries that wanted to join – government debt as a proportion of GDP could not exceed 60%. Golden rule.

And off the horses bolted. February 2012 and look at the EU as a whole or just the 17 members of the Euro currency system. The debt rate is around 85%. This is the economic explanation for why countries like Portugal, Greece and Italy are finding it difficult (impossible?) to pay back their debts. Just like a household which is not bringing in enough income, these countries are not creating enough wealth in order to manage their loan schedules.

Quietly, in the background of all this mayhem is Israel. The Ministry of Finance in Jerusalem has just announced that the country’s debt ratio is 73.3%. What’s so “wowish” about that?

• This stat represents a fall from 2010 of over 1%.
• The fall is in line with a trend commensurate for two decades.
• The additional reduction came at a time of global economic slowdown.
• The change came about despite the nominal level of debt slightly rising, indicating further real growth in the economy as a whole.

By way of comparison, the debt in the European region grew by about 10% and slightly more in the USA.

It remains to be seen how 2012 pans out. Growth in Israel is set to fall to around 2.8%. Unemployment will almost certainly rise from a 30 year low of 5.4%. There are upward pressures on government spending plans.

For now, all this is very encouraging financial news from the Holy Land.