The International Monetary Fund (IMF) has estimated Slovakia’s public finance deficit at 7-8 percent of GDP in 2010. To reach the goal of 3% in 2013, the deficit will have to be cut by a massive 2.5% next year, says head of the IMF mission in Slovakia, Mark de Broeck. Finance Minister Ivan Miklos agreed with the IMF’s projection and noted that the necessary cuts could amass to EUR 1.66 billion.
“It’s the kind of recovery that should not hold back economic growth on one hand, but which should allow us to achieve the 3 percent in 2013,” Miklos said. He went on to say that the government would have to pass measures on both sides of the budget, but refused to divulge any details at the moment.
Slovakia’s public finances have slumped drastically in the past few years, thanks mostly to strong decline in tax incomes, declared Broeck. He also said that the IMF recommended Slovakia to work hard on consolidating its public finances in the next few years, and to set up new expenditure caps in the budget.
Even so, the IMF believes that the prospects for Slovakia’s economy are pretty positive, estimating this year’s growth at around 4%, which is not as conservative as the official prognoses in Slovakia, as the Finance Ministry projects the economy to grow by 3.2% and the National Bank of Slovakia projects the growth at 3.7%.