Finance Minister predicts budget deficit of 81 billion crowns

On Wednesday, Finance Minister Miroslav Kalousek predicted that this year's budget deficit would be in the region of 81 billion CZK (4 billion USD). This figure was, he said, 10 billion CZK lower than originally predicted. Mr. Kalousek said that while the budget deficit was originally expected to be around 3.9% of GDP, this figure had been revised down to 3.6% GDP given the strong performance of the Czech economy in recent months. The Finance Minister said that public spending had created a 122 billion-crown deficit this year, but that this had been alleviated by the selling-off of shares in CEZ and other such state-run companies.

This comes as the European Commission advises the Czech Republic to make steeper cuts in its public spending. On Tuesday it directed the Czech Republic to cut its public spending deficit to below 1% of GDP by 2012.

Author: Rosie Johnston