Albanias Q1 general budget deficit edges down 2.5% y/y.

By bne IntelliNews April 27, 2012
Albanias general budget posted a deficit of ALL 11.5bn (EUR 81.9mn) in Q1 2012, down by 2.5% on the year, data from the finance ministry showed. In our calculations, the deficit accounted for 0.8% of the projected full-year GDP, down from 0.9% a year earlier. The slight improvement was due to higher revenues, up by 1.2% y/y, which did offset the 0.7% y/y increase in budget expenditure. Tax revenue picked up by 3% y/y and compensated for the 21.1% y/y decline in non-tax revenue. Combined receipts from indirect taxes inched up by 0.5% y/y, suggesting for a continued stagnation of the domestic consumption. In particular, VAT revenues were up by 0.8% y/y, excise increased by 3.2% y/y, while custom duties declined by 16.8% y/y. Receipts from social insurance contributions grew by 6.8% y/y on the back of rising health insurance and social contributions. On the spending side, the growth was driven exclusively by a 5.9% y/y increase in current expenditure. Within this, operating outlays recorded the highest growth, of 43.2% y/y, and at the same time had the largest contribution in nominal terms. By contrast, public investments in Q1 2012 remained 17.6% below last years level. Under the 2011 budget law, the general budget was projected to post ALL 46.8bn deficit, or 3.5% of GDP. Last year, the deficit totalled ALL 36.9bn, which in our estimates was equal to 3% of GDP. The government plans to cut the deficit to 3% of GDP in 2012 and to below 2% of GDP in 2013.
General Budget, Q1, ALL bn
2011 2012 % y/y
Total revenues 77.5 78.5 1.2
VAT 26.3 26.5 0.8
Corporate profit 6.4 5.0 -21.8
Excise 7.4 7.6 3.2
Personal income 6.8 6.3 -7.9
National 4.8 7.1 47.9
Customs duties 1.6 1.3 -16.8
Total social contributions 14.1 15.0 6.8
Social insurance 12.2 12.6 3.8
Health insurance 1.4 1.8 32.8
Non-tax Revenues 6.9 5.5 -21.1
Total expenditures of which: 89.3 89.9 0.7
Current 69.5 73.6 5.9
Capital 19.8 16.4 -17.6
Balance -11.8 -11.5 -2.5
Balance (% of GDP forecast) -0.9 -0.8
Source: Ministry of finance
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