Government Approves Draft Budget, Deficit to Fall to 0.1% of GDP Next Year

Prime Minister Peter Pellegrini (in the middle)

Bratislava, October 10 (TASR) – Peter Pellegrini’s (Smer-SD) Cabinet has approved a draft state budget, which expects both the debt and deficit to go down in future years, with the public finance deficit to fall to 0.1 percent of gross domestic product (GDP) next year for the first time and the economic activities of the state to be balanced in 2020, TASR learnt on Wednesday.

“Almost balanced management is projected for 2019 with a drop in the deficit to 0.1 percent of GDP to achieve a medium-term budgetary target. In 2020, balanced economic activities are projected and in 2021 for the first time a surplus of 0.2 percent of GDP,” said the Finance Ministry.

The gross debt of the general government should continue to decline in 2019, reaching 47.3 percent of GDP. “Based on the parameters of the fiscal framework for the 2019-2021 general government budget, the gross general government debt is projected to fall to 44.8 percent of GDP at the end of the budgetary period,” reads the proposal.

The state budget is expected to manage next year a cash deficit of €2.138 billion. Its total income is projected at €15.497 billion; and expenditure should reach €17.635 billion.

The current draft budget also anticipates better management this year by 0.23 percentage points. The deficit should reach 0.6 percent of GDP this year, while the budgeted target was 0.83 percent of GDP. The debt this year should also go down under the lower penalty band of 49 percent as the Finance Ministry expects gross debt at 48.7 percent of GDP.