Spanish debt below targets

9th February 2005, Comments 0 comments

9 February 2005, MADRID - The deficit in Spain's public accounts for 2004 will be "well below" the government's target of 0.8 percent of output, Economy Minister Pedro Solbes said.

9 February 2005

MADRID - The deficit in Spain's public accounts for 2004 will be "well below" the government's target of 0.8 percent of output, Economy Minister Pedro Solbes said.

Speaking to the economy committee in parliament, Solbes reiterated that he expected the Spanish economy to grow 2.9-3.0 percent in 2005 from an estimated 2.6-2.7 percent in 2004, underpinned by the "positive performance of the labour market."

A surplus in the social security component of the deficit, exceeding 1.0 percent of gross domestic product, will largely offset a budget deficit that will be smaller than expected at 1.8 percent of GDP, he said.

Factors leading to the sharper-than-expected reduction in the public deficit were limited public spending, an increase in revenues and a surplus in the social security component bigger than the 0.8 percent of output expected, he said.

Spain, as a member of the 12-state eurozone, is bound by the European Union's Stability and Growth Pact rule limiting the public deficit to 3.0 percent of GDP.

[Copyright EFE with Expatica]

Subject: Spanish news

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