Notification on General Government Budget Deficit and Debt in October 2011

17.10.2011

According to the results of the October 2011 general government budget deficit and debt notification1, which has been prepared in line with the methodology of European System of Accounts ESA’95, the general government deficit in 2010 reached 1060.3 mln lats or 8.3% of the Gross Domestic Product (GDP) and the general government debt comprised 5694.6 mln lats or 44.7% of the GDP.

October 2010 government budget deficit and debt notification: main indicators

 

2007

2008

2009

2010

Budget deficit (-)/surplus (+), mln LVL

General government

-52.8

-682.6

-1263.3

-1060.3

Central government

-365.3

-732.4

-726.6

-678.7

Local governments

-102.1

-203.6

-219.5

-66.4

Social security fund

414.6

253.4

-317.3

-315.2

General government consolidated gross debt at nominal value at the end of the year, mln LVL

1330.8

3182.4

4802.8

5694.6

Gross domestic product at current prices, mln LVL

14720.7

16084.7

13070.4

12738.7

As % over the GDP

General government deficit (-) / surplus (+)

-0.4

-4.2

-9.7

-8.3

General government consolidated gross debt at nominal value at the end of the year,

9.0

19.8

36.7

44.7

Compared to the annual report data of the Ministry of Finance, which indicated the general government budget deficit in the amount of 798.0 mln lats in 2010, the budget deficit calculated in accordance with the methodological requirements of ESA’ 95 exceeds the amount by 262.3 mln lats and reaches 8.3% of the GDP.

The necessity for adjustment arises from ESA’ 95 methodological requirements and guidelines for the preparation of financial statistics of the government sector. They require that the accrual (instead of cash flow) principle is followed in the calculations, and that financial transaction from government sector balance, as well as influence of the European Union funds is neutralized.

General governmnent budget deficit or surplus by subsectors in 2007-2010, % of GDP

As compared to the previous year, the general government debt value in 2010 has grown by LVL 891.7 mln lats or by 18.6%.

General government consolidated gross debt at nominal value at the end of the year

In the calculations of notification of October 2011 data from the Ministry of Finance, the Treasury, the Ministry of Economics, the Central Statistical Bureau and Riga City Council have been used.

The EU Statistical Office Eurostat will release information on the results of the October 2011 notification in all EU member states on October 21.

 

Prepared by the Government Finances Section
Tel.: 67366963
Vija Veidemane


1 In compliance with the requirements of Regulation EC No.479/2009, the government deficit and debt notification is submitted to the European Commission twice a year, by April 1 and October 1.The results of the notification are used for assessing how the EU member states observe the compliance of the respective economic indicators with the criteria established by the Maastricht Treaty, that is, the ratio of the planned and actual government budget deficit to the gross domestic product (GDP) at current prices must not exceed 3.0% and the ratio of the government debt to the gross domestic product at current prices must not be higher than 60.0%