Lithuania will have hard time meeting this year’s budget targets, economist says

“All of us had an opportunity to see the latest state budget revenue collection figures and look at the export figures at the start of this year. This information is not so upbeat. Nor is it tragic. However, there are no grounds to rejoice over these statistics. Exports fell and, unfortunately, fell in many product groups. We can see that the Finance Ministry is having difficulty meeting the VAT collection target,” Gitanas Nausėda, an adviser to the president of SEB Bankas, said on LRT Radio on Wednesday.

A recent downward revision by the Finance Ministry of its 2015 GDP growth forecast shows that the budget was rather optimistic and with the economy continuing to grow at a slower pace, it will not be easy to implement it, the economist said.

“If it (the budget deficit) exceeded (the projection) by a few tenths of a percent, then neither investors nor creditors would ring alarm bells about it. But if it exceeded it more significantly, say, we had a fiscal deficit twice as high as projected, then that would likely attract investors’ attention and not of a positive kind,” he said.

The Lithuanian central government sector’s deficit for the first two months of this year totalled 241.3 million euros, accounting for around 0.65 percent of this year’s projected GDP, according to data from the Finance Ministry.