Seven-month state budget deficit over three times larger than projected 12-month deficit

It is not yet known from what sources it will be covered.
Info-Prim Neo, 12 August 2009, 18:29

The state budget deficit in the seven months to July was over 1.827 billion lei. The authorities planned a deficit of only 533 million lei for the whole year, which is 3.4 times less, Info-Prim Neo reports.

As the crisis deepens, the revenues to the budget and the expenditure decreased. The incomes collected into the state budget over the first seven months of this year came to 7.2 billion lei, by 1.3 billion lei less than projected. According to the Ministry of Finance, the spending was about 9 billion lei, by 2.4 billion lei or over 21% lower.

The seven-month deficit of the national public budget was 2.51 billion lei: 1.827 billion lei in the state budget, 28.7 million lei in the budgets of the territorial-administrative units, 478.3 million lei in the state social insurance budget, and 183.5 million lei in the obligatory health insurance funds.

Minister of Finance Mariana Durlesteanu has forecast that the national public bu dget deficit at yearend will be over 4 billion lei. It is not yet known from what sources it will be covered. When adopting the budget, the authorities planned to cover the difference between the budget revenues and expenses with the money collected from privatization and with foreign investments.

The economic analysts are yet more pessimistic. They predict a deficit of 5-6 billion lei. Economist Veaceslav Ionita, who is a member of the PLDM, has told Info-Prim Neo that the only source for covering the deficit is the foreign loans from such institutions as the World Bank and the International Monetary Fund. If the new Government does not obtain such loans, Moldova could experience an economic collapse and the payment of salaries and pensions will be blocked.