Albanias general budget deficit narrows by 27.9% y/y in Jan-April.

By bne IntelliNews May 22, 2012
Albanias general budget posted a deficit of ALL 11.5bn (EUR 82.5mn) in Jan-April, down by 27.9% on the year, finance ministry data showed. In our calculations, the deficit accounted for 0.8% of the projected full-year GDP, down from 1.2% of GDP a year earlier. The improvement was due to a 2.5% y/y increase in revenues and a 1.6% y/y decline in budget expenditure. Tax revenue picked up by 3.1% y/y and compensated for the 4.7% y/y decline in non-tax revenue. Combined receipts from indirect taxes inched up by 0.4% y/y, suggesting a continued stagnation of domestic consumption. In particular, VAT revenues were up by 1.5% y/y, excise inched up by 0.4% y/y, while customs duties declined by 17.7% y/y. Receipts from social insurance contributions grew by 5.6% y/y on the back of rising health insurance and social contributions. On the expenditure side, the drop was due to a 29.3% decline in capital expenditure, which more than offset a 5.8% y/y growth in current spending. Within this, operating outlays recorded the highest growth, of 29% y/y. 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, Jan-Apr, ALL bn
2011 2012 % y/y
Total revenues 103.7 106.2 2.5
VAT 34.9 35.4 1.5
Corporate profit 7.7 6.3 -17.6
Excise 10.3 10.4 0.4
Personal income 9.0 9.0 -0.1
National 6.4 9.2 44.0
Customs duties 2.2 1.8 -17.7
Total social contributions 19.4 20.4 5.6
Social insurance 16.9 17.3 1.8
Health insurance 1.7 2.6 50.1
Non-tax Revenues 8.5 8.1 -4.7
Total expenditures of which: 119.6 117.7 -1.6
Current 94.6 100.1 5.8
Capital 25.0 17.7 -29.3
Balance -15.9 -11.5 -27.9
Balance (% of GDP forecast) -1.2 -0.8
Source: Ministry of finance
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