Monday, December 15, 2008

Romania budget revenues up 26.8 pct y/y in Jan-Nov

BUCHAREST, Dec 15 (Reuters) - Romania's budget revenues rose to 139.08 billion lei ($47.6 billion) in the first 11 months of the year, up 26.8 percent from the same period last year, data from the finance and economy ministry showed on Monday.

Revenues, which stem from the consolidated budget's main five components, amounted to roughly 28 percent of the government's gross domestic product (GDP) forecast for this year. They are unconsolidated and account for about 92 percent of overall budget revenues.

The European Union's outgoing centrist minority government has said it targets total revenues at 36.2 percent of GDP in 2008, including the absorption of some 2 billion euros worth of EU funds.

Local media have quoted finance and economy minister Varujan Vosganian saying the government lost out on 3.5 billion lei worth of consolidated budget revenues in November as companies struggled to find funds needed to pay their taxes.

Since the global credit crunch intensified in recent months, concern has grown that Romania is more vulnerable to an economic downturn than some of its peers because of a vast external shortfall, high rates of hard currency borrowing and inadequate fiscal and wage policies.

The country targets a budget deficit of 2.3 percent of GDP at the end of the year, but analysts say it could widely top the EU's ceiling of 3 percent due to high social spending before a parliamentary election last month.

Romania's fiscal plans for 2009 are unclear as centrist Democrat-Liberals and leftist Social Democrats are struggling to form a coalition government.

Analysts warn the next cabinet will have to redraft a budget plan for next year, likely taking into account lower tax receipt forecasts and poor fiscal planning by the outgoing government. (Reporting by Luiza Ilie; Editing by Ron Askew)

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