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FinMin Citu: Budget deficit, rises to 6.7pct of GDP at adjustment
The deficit of the consolidated general budget for this year rises to 6.7pct of GDP at the first budget adjustment this year, given that the measures adopted to stimulate the economy represent 3pct of GDP, announced on Wednesday Finance Minister Florin Citu in a statement at the Victoria Palace.
According to him, the cash deficit increases by 31.9 billion lei.
The Finance minister also announced that the estimates of the National Commission for Strategy and Prognosis indicate a contraction of the economy by 1.9pct this year and a nominal GDP falling to 1.12 billion lei.
"It is a budget adjustment that comes sooner than we were used to because some measures were needed to support the economy. The package that comes to support the economy, cumulatively, has a value of almost 3pct of GDP. We are talking here about furlough, guarantees for IMMInvest, aid for the liberal professions, allowances for medical leave, health, assistance for parents, incentives for medical professionals, plus tax facilities for companies, all of which add up to a package of 3pct of GDP, which means that the deficit will change. The macro coordinates from which we start: the National Commission for Strategy and Prognosis estimates that the economy will have a contraction of minus 1.9pct and a deflator of GDP of 4.9pct, which means a general increase in prices in the economy and a nominal GDP of 1.08 billion lei as compared to 1.12 billion lei as we considered in the initial budget. Under these conditions, the consolidated general budget deficit increases from 40.5 billion lei to 72.5 billion lei, which means an estimated deficit for this year of 6.7pct of GDP. These are the estimates we are making right now. With the data we have. The deficit of the consolidated general budget increases in cash terms with the amount of 31.9 billion lei," said Florin Citu.