The first-half budget shows a surplus of some 0.3 per cent of the GDP, outgoing Finance Minister Plamen Oresharski said Monday. He was speaking at his last news conference as finance minister to present the budget performance as of June 30, 2009. The surplus stands at some 173 million leva and the fiscal reserve as of July 17 is 8,200 million leva.

To add a backdrop for Bulgaria's performance, the Finance Ministry recalls European Commission analyses showing that 20 nations of EU27 will see a budget deficit of over 3 per cent at the end of the year and that unprecedented imbalances are expected in the fiscal positions.

Oresharski said that the main goals set at the beginning of the outgoing government's term in office have been achieved. He reported as a success that the country has a budget surplus for four years running: 3.1 per cent of GDP in 2005, 3.5 per cent of GDP in 2006 and 2007, and 3 per cent of GDP in 2008.

Tax revenues in the first six months of this year are 10,124.2 million leva, which is 39.4 per cent of the annual target, down from 50.3 per cent for the like period of 2008. The least favourable month for the collection of revenues is March, Oresharski said. VAT proceeds are the lowest, imports have declined 40 per cent.

The fiscal reserve as of August 2005 was a little below 4,500 million leva, and now it is 8,200 million leva, Oresharski noted. According to him, this year is the most difficult one of the last few years due to economic factors. Bulgaria is lagging behind by some 8 per cent in the implementation of the revenue side of the budget compared to last year and this is one of the best results among the EU member states,Oresharski said. The amount of expenses under the consolidated budget in the first half year is 42 per cent of the annual target, compared to 40.5 per cent in the like period of 2008.

In June there is a deficit month on month, outgoing finance minister Oresharski said, taking a question. The deficit can be financed from the fiscal reserve, and not by external financing.

"I do not believe that such a deficit can be reached for a year, that it cannot be covered by the fiscal reserve," Oresharski said. He explained that due to the excess of the revenue side of the budget in four consecutive years a considerable reserve has accumulated. According to Oresharski, this is a good buffer over the medium term.

Some 2,100 million leva is the nonfulfillment of revenues so far, the outgoing minister reported, adding that this amount can be covered by the buffers in the budget.

Source: BTA