UPDATE General consolidated budget deficit - 0.04pct of GDP in January

The execution of the general consolidated budget ended with a 460,000 million lei deficit (0.04 per cent of the GDP), in January, according to the data sent on Tuesday by the Ministry of Public Finance (MFP).

In January 2019, a surplus of 700 million lei was recorded, 0.07 per cent of the GDP, respectively.

"Compared with the surplus recorded in the same month last year, the deficit in January 2020 is mainly due to the increase in VAT refunds by 1 billion lei (1.72 billion in January 2020, compared with 0.72 billion lei in January 2019), namely the increase in the spending on investments with approximately 0.82 billion lei against the same period last year," explained the MFP representatives.

According to the same source, the revenues of the general consolidated budget amounted to 27.55 billion lei in January 2020, up 6.8 per cent from the level recorded in the same month of last year. Expressed as a share of GDP, the budget revenues registered a marginal reduction (0.1 percentage points) mainly due to the increase in VAT refunds by 141 per cent.

"We will continue this correct behavior in relation to the private environment, whether we're talking about the invoices that reached due date or the VAT refunds. The development of the first month represent a first signal that the actors in the economy understand to voluntarily comply and they trust the partnership with the state, and the proposed solutions to make public administration more flexible and better," interim Minister of Public Finance Florin Citu said.

The expenditures of the general consolidated budget, worth 28 billion lei (2.5 per cent of the GDP), increased by 11.6 per cent in nominal terms, compared with the same month of the previous year. Expenditures increased by 0.07 percentage points, from 2.4 per cent of the GDP in 2019 to 2.5 per cent of the GDP in 2020.