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FinMin: Spring Eurostat notification confirms debt decreasing

The debt of Slovakia declined by one percentage point year-on-year, Eurostat informed.

Finance Minister Peter Kažimír (Source: TASR)

The statistics office of the European Union, Eurostat, in its spring notification announced that the Slovak Republic’s debt declined to 52.01 percent of gross domestic product last year, against 53.90 of GDP in 2015.

In the upcoming years, the debt is expected to decline below the level of 50 percent, the Slovak Finance Ministry wrote on April 21.

Slovakia entered the notification negotiations with a deficit of 2.56 percent of GDP, including corrections amounting to about 0.3 percent of GDP on which the ministry had no influence. During the notification, Eurostat decided at the last moment not to include some transactions in the revenues which impacted negatively the economic results. Finance Minister Peter Kažimír commented on such “last moment surprises” as not being fair and requiring further discussion.

The deficit of public finances last year was at 2.97 percent of GDP, according to Eurostat’s spring notification.

Despite consultancies and explanations, Eurostat did not acknowledge the repayments of financial aid from the Cargo company – more then €117 million- as revenues. Moreover, it did not recognise the revenues of the State Fund for Development of Housing (ŠFRB) of almost €200 million which stem from EU resources and are meant to render recoverable sources of financing. “In the past, such operations were never questioned by Eurostat,” Kažimír added.

The amount of deficit was negatively impacted also by the husbandry of local self-administrations when municipalities, despite the reported excesses, did not achieve the budgeted amount. The Environmental Fund and some other “newly allocated” subjects to the public administration sector (state railways, National Highway Administration, Recycling Fund, public hospitals) also contributed to the budgetary deficit increase , Finance Ministry explained. Positive news stems mostly from improved tax collection which brought in almost half a billion euros more in 2015. Expenses to service the state debt improved, too – by more than €34 million. 

Topic: Economics

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