Budget still negative
26/04/2012 00:00
Linda Rama: Between Family, Work and Albania’s Future 18/08 14:30
The government budget revenues increased with 1.2% in the first
trimester of this year, compared to the same period of 2011, making even
more convincing the conclusion that this is another difficult year for
the public finances. This is one of the two worst results since 2008,
when the international crisis took off.
Compared to the plan, the budget revenues for January-March were 40 million USD less. Despite seeing unrealized revenues month after month, the government still doesn’t let go of high expenses. According to the Ministry of Finances, the general budget expenses for the first trimester were 44 million higher than the plan.
The increased expense level, beyond all predictions, has been noted in public investments, operative and maintenance expenses. This over expenditure and lack of revenues has increased the budget deficit to 115 million USD, or 3.8 times more than predicted by the government in this period, putting i9n doubt its capability to keep it under control, as it has promised several times.
Being in this bad situation, the government was obliged to take more loans in the domestic market, through private banks. In the first trimester, the government had predicted to take a 426 million ALL debt, but due to the strong increase of the deficit, they loaned 8.2 billion ALL, or 19 times more.
This crossing of the budget indicator limits might have derived by temporary factors for which the government has given no declaration, but it shows that the government finances are still in danger. Meanwhile, the government has spent almost the entire contingency fund that was to keep the deficit within the limits for the first three months. This means that in case of other economic hits, the deficit could go out of control by obliging the government to review the budget by shrinking it even further.
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