Turkey runs $5 billion budget deficit in four months amid government incentives to boost growth
AA photoThe Turkish government ran a budget deficit of 17.9 billion Turkish Liras (around $5 billion) in January-April and 3 billion liras (around $843.5 million) in April, mainly due to a rise in state incentives to back the economy.
“The budget deficit was higher than last year through the first four months due to the government’s incentives in support of economic growth,” Finance Minister Naci Ağbal said in a statement on May 15, as quoted by Anadolu Agency.
Turkish government revenues in the first four months stood at 197.8 billion liras (approximately $55.6 billion), marking a 9 percent rise year-on-year, while budget expenditures were 215.7 billion liras (around $60.6 billion), with an increase of 22.5 percent compared to the same period last year, according to the ministry.
Ağbal said the state’s tax revenue has increased by 14.3 percent in April compared to last year.
“This increase indicates a recovery in production, consumption and economic activity,” he added.
With a further rebound in the economy and a gradual termination of the temporary economic measures, the budget gap will moderate, Ağbal claimed.
Official data showed that tax revenues rose 12.6 percent during the first four months to reach 158.7 billion liras ($44.6 billion).
The government’s expenditures for health, pensions and welfare were up by almost 45 percent between January and April to stand at 51.3 billion liras (around $14.4 billion) over the same period last year, while personnel expenditures increased by 8 percent, reaching almost 55.2 billion liras (approximately $15.5 billion).
Interest expenditures stood at 22.5 billion liras (some $6.3 billion) over the same period, corresponding to an increase of 15.1 percent.
In April, budget revenues reached 53 billion liras (around $14.9 billion), a 6.7 percent increase over the same period last year, while budget expenditures surged by 26.3 percent reaching 56 billion liras (some $15.7 billion).
Ağbal said government policies would continue to affect the 2017 budget.
“However, the necessary determination will remain for a sustainable budget deficit,” he added.