Bulgaria's 10-month budget deficit overshoots full-2014 target by 0.4pps

By bne IntelliNews November 11, 2014

Bulgaria's 10-month budget deficit equalled 2.2% of GDP, which compares to a full-year target of 1.8%, according to preliminary finance ministry data.

The new minority cabinet, which is reluctant to cut spending and also has limited capacity to boost revenue, plans to soon ask the parliament to approve a higher 2014 deficit target of 3.7%/GDP.

The cabinet of PM Boyko Borissov has not said when it plans to bring the projected deficit within the EU's 3% ceiling. Breaching EU budget rules could prompt the European Commission to open an excessive deficit procedure against Bulgaria.

The government spent BGN1.78bn (€907.5) more than it collected in revenues in January-October, which compares to a gap of BGN443mn a year earlier. Revenues rose 1.1% y/y to BGN24bn, but expenditures (contribution to the EU budget included) advanced 6.6% y/y to BGN25.8bn.

The finance ministry blames overly optimistic revenue planning and higher spending for the deficit increase. Income from VAT, excise duties and corporate taxes is underperforming, while social-welfare spending is growing faster than projected. The use of national budget money to pay for expenses that are usually covered by the EU's operational programmes has also contributed to the unplanned growth of the deficit.

Bulgaria's general govt budget, BGN mn Jan-Oct 2013 Jan-Oct 2014 Change, y/y
Revenues and grants 23,751.3 24,004.0 1.1%
Tax revenue 18,470.6 19,151.0 3.7%
Non-tax revenue 3,201.9 2,978.0 -7.0%
Grants 2,078.8 1,876.0 -9.8%
Total expenditures 24,194.2 25,779.0 6.6%
Budget expenditures 23,404.3 25,036.0 7.0%
Contribution to the EU budget 789.9 743 -5.9%
Budget balance -443.0 -1,775.0 300.7%
% of GDP -0.6% 2.2% /
Source: FinMin      

Related Articles

EU asks CEE to comment on Russian gas promises

The European Commission has invited comments from Central & Eastern European states on proposals put forward by Russian gas giant Gazprom to meet competition concerns. Visegrad and the Baltic ... more

EBRD says 2016 net profit was around €1bn

The European Bank for Reconstruction and Development (EBRD) said it made a net profit of around €1bn in 2016, up by a quarter from the €802mn it made in ... more

New Bulgarian government reports irregularities in defence contracts

A check on public procurement under Bulgaria’s previous centre-right government has revealed dozens of violations in the defence ministry, caretaker Prime Minister Ognyan Gerdzhikov said on ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss