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The European Commission (EC) evaluated the budget plans of the eurozone countries for 2024 and concluded that the state budget plan prepared in connection with Latvia was not fully compatible with the recommendations given on increasing expenses – faster than recommended, EC Valdis Dombrovskis (JV) Deputy Chairman of the Executive Board he said:
According to the statement of the EC vice president, Dombrovskis’ advisor Maija Celmiņa informed that other countries have a similar opinion about the EC, that the budget plan is not fully compatible with the recommendations given. The EC’s administrative deputy chairman emphasized that Latvia, like many other countries, should pay more attention to fiscal discipline issues.
“Looking at the autumn economic forecasts of the EC, we can see that the budget deficit in Latvia this year and next year is estimated to be slightly above 3% of the gross domestic product. It is important to gradually reduce the budget deficit in the coming years,” stressed Dombrovskis.
He explained that there is a similar recommendation for the Eurozone in general, that is, a recommendation to move towards a tighter fiscal policy in order to harmonize fiscal policy and monetary policy. The EC’s vice president also noted that the European Central Bank is currently implementing a tighter monetary policy to reduce inflation, so it is important that fiscal policy also helps reduce inflation, noting that additional fiscal stimulus at this time will not stimulate the economy. but inflation.
The EC also concluded that there is no macroeconomic imbalance in Latvia and that Latvia will not be evaluated in depth.
TVNET had already written on November 16 that the majority of the Saeima conceptually supported the bill “on the 2024 state budget and the budget framework for 2024, 2025 and 2026.” The Saeima is expected to begin considering the budget at the second and final reading on December 7.
At the beginning of November, the government supported the draft 2024 state budget and the budget framework for 2024, 2025 and 2026, in which the revenues of the consolidated state budget next year are planned to be 14 billion 486 billion euros, while expenditures are planned to be 14 billion 486 billion euros. 16.212 billion euros.
The total revenues of the general government, which includes the entire administrative structure of the state and municipalities and social insurance institutions, are planned to be 17.8 billion euros and expenses to be 19.1 billion euros for next year. billion euros. Thus, in 2024, the general government’s budget deficit is planned to be 1.3 billion euros, that is, 2.8% of the gross domestic product (GDP).
The budget deficit is planned to be 2.3% of GDP in 2025 and 0.9% of GDP in 2026. On the other hand, it is estimated that next year the national debt will be 18.6 billion euros, that is, 41% of GDP.
The three main national priorities are internal and external security, education and health.
Compared to the 2023 budget, the planned state budget revenues in 2024 are planned to be 1 billion 763 billion euros higher. On the other hand, state budget expenditures in 2024 are planned to be 1 billion 538 billion euros higher than stated in the 2023 state budget law.
The revenues planned in the basic budget are 10.016 billion euros and the expenses are 12.148 billion euros. In the special budget, 4 billion 761 billion euros of revenue and 4 billion 356 billion euros of expenditure are planned.
Source: Tv Net
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