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“We think there is a really high risk that the deficit will grow and increase mainly because of the pandemic situation. We see the second wave, the spring, the question of whether there will be another wave. they are planned, as planned in 2020, “said V. Vasiliauskas, emphasizing that if some of the projects in the ADN plan did not meet the EU requirements, it would affect the budget deficit.
“If only part of the projects were eligible, if only part of the funds were received, the deficit would certainly increase. If half of the funds are not received, the deficit could be higher by 0.8%, if funds are not received by around 20%, the deficit could increase by 0.3% ”, he said.
“With regard to the budget now presented and the balance of risks, there is a high risk that the budget deficit will be greater than the current baseline of 5%. deficit. Because the current project does not potentially cover all the costs that could be incurred to combat COVID-19, especially in the context of economic instruments, “he said.
V. Vasiliauskas also added that the uncertainty of the budget deficit for next year is also determined by the uncertainties related to the European Recovery Fund and the increase in pensions.
“If we make an analogy with this year’s budget, a large part of the measures that have been taken but are not included in this year’s budget are not foreseen in next year’s budget. There are also uncertainties regarding the Fund. European Recovery. The second additional increase in pensions is not included in this budget, “he said, adding that the Bank of Lithuania’s forecast for next year’s budget is” really realistic and cautious. “
According to V. Vasiliauskas, there is too much urgency with the DNA plan.
Meanwhile, referring to the stability of the financial system, V. Vasiliauskas did not see significant risks.
“Because a little less than 500 million more extra money is pouring in through additional measures. The effect on inflation is around 0.2%. point. In fact, it is small. Regarding the stability of the financial system, we do not see great threats here, ”V. Vasiliauskas told Seimas BFK.
“Yes, the recession will be one of the smallest in the EU, but I notice the number of deficits, it is greater than that,” he added.
No less than 5% is forecast for next year. GDP deficit of the public administrations.
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