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Finance Ministry says 2011 budget deficit decreases 26 percent y-o-y

The state budget deficit in 2011 was €3.276 billion, a 26-percent reduction year-on-year, according to a statement from the Finance Ministry released on January 2. The 2011 deficit was originally projected to reach €3.8 billion, compared to €4.4 billion in 2010, the TASR newswire wrote. State revenue stood at €12.002 billion for 2011, 10 percent higher y-o-y and represented 91.3 percent of the amount stated in the original budget plan – €13.148 billion. State expenditure was €15.278 billion in 2011, 0.4 percent less than in 2010. This figure represented 90 percent of the originally projected amount – €16.958 billion.

The state budget deficit in 2011 was €3.276 billion, a 26-percent reduction year-on-year, according to a statement from the Finance Ministry released on January 2. The 2011 deficit was originally projected to reach €3.8 billion, compared to €4.4 billion in 2010, the TASR newswire wrote.

State revenue stood at €12.002 billion for 2011, 10 percent higher y-o-y and represented 91.3 percent of the amount stated in the original budget plan – €13.148 billion. State expenditure was €15.278 billion in 2011, 0.4 percent less than in 2010. This figure represented 90 percent of the originally projected amount – €16.958 billion.

Poštová Banka analyst Eva Sadovská said that if the state manages its accounts this year in much the same way as last year, the public finance deficit should come in at about 5 percent of GDP in 2012. "I think that no one really expects to see the deficit in public finances standing at 3.8 percent of GDP in 2012, as originally estimated," Sadovská told TASR.

Sadovská added that this is mostly due to an expected deceleration in economic growth that will lower state revenue as well as GDP and considerable expense from the early election in March.

Tatra Banka analyst Boris Fojtík said the official macro-economic estimates are of the most concern to his bank in 2012. "In our opinion, the [official] tax revenue prognosis is too optimistic. If our more pessimistic scenario comes true, the public budget will be short an additional €200 million, approximately," Fojtík stated, as quoted by TASR.

Source: TASR

Compiled by Zuzana Vilikovská from press reports
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