Ireland has reported a drop in its deficit for 2011 to 13.4% from 30.9% in 2010 as the one-off expense of shoring up the banking sector disappeared from the Government's books.
But debt levels in 2011 jumped to 106.4% from 92.2%.
The figures are in the Maastricht Returns, which are submitted by each EU member state to the EU's statistics office, Eurostat, twice a year, at the end of March and the end of September.
After a three-week clarification process, the agreed returns are published by Eurostat.
Europe-wide, the Maastricht Returns show that the euro zone's fiscal deficit fell sharply last year as governments slashed expenses and raised taxes to regain market confidence in their public finances, but public debt still climbed.
Eurostat said the aggregate budget deficit in the 17 country euro zone fell to 4.1% of gross domestic product in 2011 from 6.2% in 2010 - the first year of the sovereign debt crisis.
Euro zone public debt, however, rose to 87.3% of GDP in 2011 from 85.4%, Eurostat said.
The euro zone's biggest economy, Germany, slashed its budget deficit to 0.8% in 2011 from 4.1% in 2010 and its debt fell to 80.5% of GDP from 82.5%.
Greece, where the crisis started, had the highest debt in Europe last year, reaching 170.6% of GDP even though it reduced its deficit to 9.4% from 10.7% in 2010 and 15.6% in 2009. The 2011 Greek deficit number is 0.3 percentage points higher than estimated by Eurostat in April, mainly because of a downward revision of Greek economic growth, Eurostat said.
Spain, whose public finances are now in market focus, reduced its budget deficit only marginally to 9.4% in 2011 from 9.7% in 2010. The 2011 figure is 0.9 percentage points higher than previously reported.
But Spain's debt was still relatively low, at 69.3% of GDP against 61.5% in 2010. Italy, also under market scrutiny cut its budget shortfall to 3.9% from 4.5% in 2010. Its debt inched higher to 120.7% from 119.2%.
Portugal, already on a euro zone financial lifeline after being cut off from market borrowing, more than halved its budget deficit last year to 4.4% of GDP from 9.8% as a result of reforms, but its debt jumped to 108.1% from 93.5%.
The figures also show that Ireland's underlying deficit fell by 1.6 percentage points to 9.1% of GDP last year, well below the EU-IMF programme limit of 10.6%.
The Department of Finance said that in July 2011, a net amount of €16.5 billion was injected into the Irish banks. After the finalisation of the restructuring plans of AIB and Irish Life and Permanent and talks with Eurostat, it has now been determined that €6.8 billion of the €16.5 billion net injection is classified as a deficit-increasing capital transfer.
The effect of this €6.8 billion is to add 4.3% of GDP to the deficit for last year. This amount was provisionally estimated at €5.8 billion by the end of March.
However, the Department notes that as the recapitalisation of July 2011 was fully reflected in Ireland's general government debt reported since September 2011, the country is no worse off.
''This is simply a statistical classification for deficit purposes. There is no impact on our debt position. There is also no impact on the underlying deficit,'' the statement added.
