NBS: State budget deficit likely to reach 2.9 percent of GDP in 2014

If the shortfalls in state income aren’t replaced, Slovakia’s state budget will post a deficit of 2.9 percent of GDP in 2014, even though the official state budget for this year is counting on only a 2.64 percent deficit, the Slovak central bank (NBS) said in its February bulletin. “Several changes have been adopted compared to the approved 2014 deficit which have caused the shortfall in one-shot incomes to the tune of €300 million,” the NBS said, as quoted by the TASR newswire. The total shortfall is 0.4 percent of GDP, and concerns mainly the dividends from the SPP gas utility and the Slovak Electricity Transmission Network (SEPS), which should originally have been paid out this year. Other shortfalls include a lower-than-expected income from the sale of available telecom licences, which is however expected to be partially offset by a better collection of taxes and payroll deductions (up 0.3 percent of GDP). The European Commission, in a forecast from late February, states that the Slovak state budget deficit in 2013 may have reached 2.5 percent of GDP, while it forecasts Slovakia’s deficit to reach 3.3 percent in 2014 and 3.4 percent in 2015. At the same time, the public debt is expected to increase from 54.3 percent of GDP in 2013 to 57.8 percent in 2014 and 2015 – a level that prescribes no further measures to increase the debt under Slovak law.

If the shortfalls in state income aren’t replaced, Slovakia’s state budget will post a deficit of 2.9 percent of GDP in 2014, even though the official state budget for this year is counting on only a 2.64 percent deficit, the Slovak central bank (NBS) said in its February bulletin.

“Several changes have been adopted compared to the approved 2014 deficit which have caused the shortfall in one-shot incomes to the tune of €300 million,” the NBS said, as quoted by the TASR newswire.

The total shortfall is 0.4 percent of GDP, and concerns mainly the dividends from the SPP gas utility and the Slovak Electricity Transmission Network (SEPS), which should originally have been paid out this year. Other shortfalls include a lower-than-expected income from the sale of available telecom licences, which is however expected to be partially offset by a better collection of taxes and payroll deductions (up 0.3 percent of GDP).

The European Commission, in a forecast from late February, states that the Slovak state budget deficit in 2013 may have reached 2.5 percent of GDP, while it forecasts Slovakia’s deficit to reach 3.3 percent in 2014 and 3.4 percent in 2015. At the same time, the public debt is expected to increase from 54.3 percent of GDP in 2013 to 57.8 percent in 2014 and 2015 – a level that prescribes no further measures to increase the debt under Slovak law.

(Source: TASR)
Compiled by Zuzana Vilikovská from press reports
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