Slovak Finance Ministry Cuts 2012 Growth Forecast to 1.1%
February 06, 2012, 8:39 AM ESTBy Radoslav Tomek
(Updates with budget, forecast in fourth, fifth paragraphs.)
Feb. 6 (Bloomberg) -- Slovakia’s Finance Ministry cut its 2012 economic growth forecast to 1.1 percent from 1.7 percent as Europe’s debt crisis damps demand.
The Bratislava, Slovakia-based ministry said today in a preliminary update of its economic outlook from November that it’s keeping its 2013 and 2014 gross domestic product forecast at 2.7 percent and 3.6 percent, respectively.
Exports, the main driver of the east European country’s growth, are set to slow in 2012 as the lingering debt crisis in the euro region depresses demand, the ministry forecasts. At the same time, domestic demand will be hurt by the government’s austerity measures.
Even as the economy will expand at a slower pace than predicted in the 2012 budget, the slowdown will not require adoption of any fiscal measures after last year’s budget gap was smaller than projected, the ministry said. The 2011 budget deficit probably reached 4.6 percent of GDP, compared with 4.9 percent of GDP targeted.
The ministry also revised its forecast for the average 2012 inflation rate to 2.8 percent from 2.6 percent. Price growth will slow to an average 2.3 percent in 2013 and 2014, according to the forecast.
For related news and information: Top Eastern Europe News: TOP EEU <GO> Economic Statistics: ECST <GO> Slovak Treasury Bonds: SLOVGB <Corp> <GO>
--Editor: James M. Gomez
To contact the reporter on this story: Radoslav Tomek in Bratislava at rtomek@bloomberg.net
To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net
