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October 1, 2020
ECONOMY FINANCE&BANKING

2017 budget draft based on 5.2pct economic growth and 2.96pct of GDP budget deficit

The 2017 budget draft is based on a 5.2 percent economic growth provided estimated for this year and above 5 percent over the entire 2018-2020 time frame, the (cash) budget deficit being forecast at 2.96 percent of the GDP, and the annual average inflation rate, at 1.4 percent, according to the report on the macroeconomic situation on 2017 and its projection on the 2018-2020 interval, released on the Public Finance Ministry’s (MFP) website on Monday.

According to the document, the Gross Domestic Product (GDP) in 2017 is estimated at 815.198 billion lei, the revenues to the general consolidated budget, at 254.717 billion lei (with a 31.2 percent share in the GDP), and expenses, at 278.817 billion lei (34.2 percent share in the GDP), resulting in a 24.1 billion lei deficit (2.96 percent of the GDP). The average leu/euro exchange rate is estimated at 4.46 lei for one euro, and the monthly average salary earning, at 2,274 lei.

“The budget revenues projected for 2017 represent 31.2 percent of the GDP, 32.4 percent in 2018, and in 2020 they will represent 32.8 percent of the GDP, an evolution determined by the development of the macroeconomic indicators during the reference time frame, as well as by the normative acts adopted so far. The budget expenses projected for 2017 represent 34.2 percent of the GDP, and will reach 34.8 percent of the GDP in 2020, with a 0.6 percentage points increase, in the context in which investment expenses go up 2.6 percentage points in 2020 compared to 2017. (…) For 2017, a (cash) budget deficit level of 2.96 percent of the GDP is estimated, while the ESA deficit is estimated at 2.99 percent of the GDP, keeping within the under 3 percent of the GDP budget deficit target, according to the provisions of the Maastricht Treaty. On the 2018-2020 time frame, it will enter an adjustment trajectory starting 2018, being forecast to reach 2.53 percent of the GDP in 2019 and 2.02 percent of the GDP in 2020,” the report mentions.

The documents points out that on the reference time frame there is estimated a deviation from the Medium-Term Budgetary Objective (MTO) established for Romania, namely 1 percent of the GDP, the structural deficit for 2017 being estimated at 2.92 percent of the GDP, in 2018, at 2.97 percent of the GDP, and following a declining trajectory starting with 2019 and 2020.

“Even in the context of having this risk, the deviation from the MTO would occur in the conditions of keeping, during the entire planning time frame, a sustainable level of the public debt, under 40 percent of the GDP,” the report also says.

 

Budgets allotted to SRTv, SRR, AGERPRES and CNA for 2017, increasing from previous year

 

The Romanian Television Corporation (SRTv) has allotted in 2017 a 950.000 million lei budget, up 661.92pct from the preliminary budget execution of 2016, the Romanian Radio Broadcasting Company (SRR) has earmarked a 383.000 million lei budget (+98.61pct), the budget allotted to AGERPRES accounts for 21.844 million lei (+7.16pct), and that of the National Audiovisual Council (CNA) stands at 9.851 million lei (+3.17pct).

According to the budget draft released on the Public Finance Ministry (MFP) website on Monday, SRTv has 950.000 million lei allotted for current expenses (+687.83pct compared to 2016), out of which for Goods and Services – 5.713 million lei (-94.95pct) and for other transfers – 944.287 million lei.

SRR has 383.000 million lei earmarked for current expenses (increasing 98.61 percent from 2016), out of which for Goods and Services – 13.730 million lei (-91.69pct) and for other transfers – 369.270 million lei.

AGERPRES has allotted for 2017 a budget worth 21.844 million lei (increasing 7.16 percent from the preliminary budget execution of 2016). For current expenses, it has earmarked 21.219 million lei (+7.90pct), out of which personnel expenditure – 15.756 million lei (+4.83pct), goods and services – 5.445 million lei (+17.91pct). For capital expenses the allotted amount declines 13.07 percent from 2016.

The budget proposed for the CNA in 2017 accounts for 9.851 million lei, increasing 3.17pct from the preliminary execution of the previous year. For current expenses the earmarked amount is 9.575 million lei (+2.71pct), out of which personnel expenses – 8.400 million lei (+3.35pct) and goods and services – 1.163 million lei (-1.61pct). For capital expenses the allotted sum increases 22.12pct from 2016.

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