BRATISLAVA, December 2, (WEBNOVINY) – Given the so-far development, the Finance Ministry expects this year’s public deficit to not exceed the projected 4.9 percent of the gross domestic product (GDP) this year. „Based on the currently available data, the goal should be met,” the Finance Ministry writes in a report on the macroeconomic development, which the Cabinet is yet to debate.
The ministry estimates that in nominal terms, the public administration deficit will be by EUR 87 million lower than the budgeted plan. This better-than-predicted development will be compensated with lower-than-expected nominal growth of GDP. According to its latest prognosis, the Finance Ministry estimates this year’s economic growth at 3 percent, which is slower by 0.3 percentage points than predicted in the 2011 budget.
In connection with the deficit development, the ministry has identified several positive as well as negative risks. „Potential positive effects result from probably lower drawing of funds designated for financing common Slovak–EU projects and lower drawing of carried-over expenditure limits from previous years,“ the ministry states in the report. Within common Slovak-EU projects, expenditures should be lower by EUR 205 million. The state debt should be lower by EUR 103 million as a result of a favorable development of the state budget deficit in the first half of the year.
On the other hand, negative risks are connected with the performance of self-governments and the development of liabilities and commitments of the public administration. The indebted state-run railway companies and their revitalization will require additional sources of almost EUR 241 million. The ministry estimates the debt of state-run health care facilities to grow by EUR 120 million. Additional shortfall of EUR 100 million is related to unrealized sale of emission allowances.
For next year, the Cabinet has proposed a budget with a 4.6-percent deficit. The original plan counted on a consolidation at 3.8 percent of GDP, but the deepening financial and economic crisis and the collapse of Iveta Radicova’s Cabinet have hampered the ambition.
SITA
