After the Finance Ministry has submitted proposal for the 2016 state budget, which envisages a slightly bigger fiscal deficit than this year, the National Audit Office says this raises the risk for long-term sustainability of government finance. President Dalia Grybauskaitė warns that Lithuania might exceed the limit provided by the EU's fiscal compact.
© Shutterstock nuotr.

The National Audit Office said that the 1-percent government finance deficit envisaged by the Ministry of Finance for 2016-2018 is too big. The deficit, it says, cannot exceed 0.5 percent, because Lithuania does not meet the criteria of the EU's fiscal compact agreements to run a deficit of 1 percent.

President Grybauskaitė said on Monday that Lithuania's public finance can hit the limit of how much deficit it is allowed to run under fiscal discipline rules.

"The state budget is a complex product, especially before elections. We can see that social welfare remains a priority, which is a good thing. There's also additional funding to strengthen our defence, which is also good. But seeing the overall deficit rise so significantly, compared to 2014, indicates that spending exceeds the planned revenue much more than in 2014 or this year," Grybauskaitė told journalists on Monday and is quoted by BNS.

She reminded that Lithuania had undertaken commitments under EU directives and national legislation to stick to fiscal discipline and will have to submit its 2016 budget to inspection by the European Commission.

Finance minister: Facebook cryptocurrency needs global solution

Facebook 's plans to issue its cryptocurrency , the Libra, as well as plans by other companies on...

Dutch chain eyes Lithuania

Dutch retail chain Spar International has registered two brands, Eurospar and Interspar , in...

Border guards allowed to continue CCTV tender worth EUR 2.5 mln

A Lithuanian court has allowed the country's State Border Guard Service to continue its tender ,...

Lithuanian financial firm takes over Danske Bank's investment portfolio in Estonia

Lithuanian financial firm Orion Securities is taking over Danske Bank 's investment portfolio in...

Achema loses EU court case over state aid for Klaipeda LNG terminal

The EU General Court on Thursday rejected an appeal by Achema , a Lithuanian fertilizer producer...