Tuesday, September 27, 2011

Romania 8-month budget gap rises to 2.4 pct/GDP

(Reuters) - Romania's consolidated budget deficit rose to 2.4 percent of gross domestic product in the first eight months of the year, from 2.1 percent in January-July, the finance ministry said on Monday.

Romania, which has a 5 billion euro aid deal led by the International Monetary Fund, targets a deficit of 4.4 percent of GDP overall this year.

In nominal terms, the shortfall stood at roughly 13 billion lei ($4.09 billion). The eight-month shortfall compares with a gap of 4.1 percent in the same period of last year.

Revenues stood at roughly 116 billion lei, or 21.4 percent of GDP, up some 9.5 percent on the year, bolstered mainly by higher VAT and excise tax receipts. Budget spending stood at 129.3 billion lei.

While analysts see the government reaching its end-year deficit target, worries have risen in recent months that market turmoil and a deteriorating economic growth forecast for 2012 would hurt the country's tax revenue.

Analysts have said the centrist coalition government would need additional measures to boost revenue and cut spending in order to reach an ambitious deficit target of 3 percent of GDP next year. ($1 = 3.181 Romanian Lei) (Reporting by Luiza Ilie; Editing by Sam Cage)

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