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Hungary: 2009 budget targets 3.4%-of-GDP cash flow deficit – FinMin

  The 2009 budget targets a cash flow-based deficit of 3.4% of GDP, Finance Minister János Veres said before presenting the budget to the House Speaker on Monday.

 

The budget targets a cash flow-based deficit of Ft 975.9 billion, calculating with revenue of Ft 17,088.3 billion and expenditures of Ft 18,064.3 billion. The budget targets an ESA’95 deficit of 3.2% of GDP, in line with the convergence program target. Veres noted that, including the effect of pension reforms, the ESA’95 deficit would narrow to 2.9% of GDP.

The budget projects 3.0% GDP growth, to Ft 29,110 billion in 2009 from Ft 27,440 billion in 2008, and 4.3% average annual inflation. The budget targets a primary surplus -- excluding interest revenue and expenditures -- of Ft 199.3 billion, or 0.7% of GDP, compared to a primary deficit of Ft 103.3 billion, or 0.4% of GDP, in the 2008 budget.

Interest expenditures are seen growing to Ft 1,175.2 billion in 2009 from Ft 1,118.5 billion in 2008. The budget targets a central budget deficit of Ft 855.7 billion, or 2.9% of GDP, down from Ft 1,117.6 billion, or 4.1% of GDP, in the 2008 budget.

According to the Finance Ministry’s latest projection, the 2008 central budget deficit will be Ft 184 billion less than planned. The budget targets a local council deficit of Ft 134 billion, or 0.5% of GDP, in 2009, up from Ft 111.1 billion, or 0.4% of GDP, in 2008.

Parliament will vote on the budget on December 15, House Speaker Katalin Szili said. (MTI-Econews)