The risks of the new budget
05/11/2011 00:00
Linda Rama: Between Family, Work and Albania’s Future 18/08 14:30
Although the next budget will be only 3% bigger than the last one, the
lowest increase compared to the last years, it still might result too
optimistic and unrealizable.
The first risk comes from the revenues progress during the year. The increase of 3% is foreseen based on the plan of the 2011 revenues. But if this will be compared with the realization, the calculations change a lot. The total revenues this year are predicted to 343 billion ALL.
Due to the shortfall, the government is expecting the annual revenues to be not higher than 330 billion. This means that the predicted growth in revenues shout be 7%, not 3%.. Judging by the tax progress in the first nine months of this year, when the revenues have grown with only 1%, the chances for this budget to fail are high, because it will be difficult for the tax and custom administration to increase the revenues seven times more.
But this is not the only danger. Other insecurities come from the economic growth. The government says that in the next year, the Albanian economy will grow with 4.3%.
Two days ago, BERZH declared that due to the Greek crisis, Albania might have one of the worst economic years with only 1% economic growth. This indicator directly damages the deficit and the public debt. Even this year, the budget planning was supervised by the IMF, but different to other times, the IMF experts left without giving any public declaration. Maybe this is a signal for the troubled times that the public finances are experiencing.
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