Budget in liquidity crisis

The official data show that the government has consumed 90.1% of the internal loan only by June. The Parliament authorized the government to take a 28 billion ALL internal loan in the budget 2013.

But by the end of June the government has taken 25.2 billion, leaving just 2.8 billion ALL for the remaining half of the year. The internal debt is the instrument that allows the government to fund the difference between daily spending and the revenues it collects from taxes and other sources.

This mean that with the current situation, the government should not spend any more from every tax that it collects. Experts say that this is impossible, since the current revenues are unable to fund the obligatory spendings of the budget, such as wages, pensions and debt interests.

Even if the government raises investments, operative spending and maintenance, it will be unable to pay wages and pensions, or to pay the public debt without taking a new loan. Only once the budget faced a similar situation, and it was in 1997. The new government of that time was obliged to sign an emergency agreement with the International Monetary Fund, similar to those in the African countries.

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