RIGA - The general government budget deficit last year totaled 4.8 billion lats (6.8 billion euros) or 36.7 percent of gross domestic product, according to budget deficit and debt figures calculated pursuant to the European System of Accounts (ESA )methodology.
General government sector debt last year increased by 1.62 billion lats or 12.4 percent of the GDP from 2008, however, it does not exceed the relevant Maastricht criterion (60 percent), the Central Statistical Bureau reports.
Debt before consolidation among sub-sectors was 5.2 million lats to the central government, 760 million lats to local governments, 0.2 million lats - to the social security fund.
The general government deficit in 2009 reached 1.34 billion lats or 10.2 percent of GDP and the general government debt was 4.8 million lats or 36.7 percent of GDP.
Compared to the Finance Ministry’s report, which said that the general government budget deficit was 897.9 million lats (6.9 percent of GDP) last year, the budget deficit calculated according to the ESA methodology is by 442.6 million lats larger and stands at 10.2 percent of GDP.
Major changes in final data for 2009 (0.9 percent of GDP) are related to financing of aid for Parex banka - government investment of 113.6 million lats in the equity capital of the bank. According to the requirements of the Manual of General Government Budget Deficit and Debt, government investment in Parex banka is acknowledged as a capital transfer which increases government expenditure.
Other major adjustments with negative impact included exclusion of revenues from greenhouse effect gas emission trade belonging to the country from the budget - by 91.4 million lats or 0.7 percent of GDP; inclusion of Southern Bridge construction costs into sub-sector expenditure of the local government - by 80 million lats or 0.6 percent; adjustment regarding creditors - by 74.3 million lats or 0.6 percent; adjustment of difference of interest accrued and paid - by 57.6 million lats or 0.4 percent; tax adjustment using time-adjusted cash method - by 39.7 million lats or 0.3 percent; impact of enterprise balance results controlled and financed by state and local government reclassified to general government sector - by 30.4 million lats or 0.2 percent.
At the same time, adjustment with positive impact included adjustment of acquisition of European Union Funds - by 75.3 million lats or 0.6 percent; income from privatization - by 9.9 million lats or 0.1 percent.
On October 22 the EU statistical office Eurostat will release information on the results of the October 2010 notification in all EU member states.