Even though the Lithuanian central bank last week cut its GDP growth forecast for this year, Prime Minister Algirdas Butkevičius says that the government is not planning to revise the national budget, at least for now, adding that EU support should help cushion the impact of slower growth.
Algirdas Butkevičius
© DELFI / Tomas Vinickas

"We do not intend to do so at the moment. We are currently working very intensively with all ministries to ensure that we start using the money allocated from the EU's structural funds as soon as possible and that as many as possible projects get underway by the middle of the year," Butkevičius said on the radio Žinių Radijas on Thursday.

"If this issue is resolved, applications are assessed and projects are ready [...], we will then cushion the planned losses," he said.

The Bank of Lithuania last week revised its GDP growth forecast for this year down to 2.7 percent, from 3.1 percent projected in December. The central bank said that the downward revision was mostly due to the worsening economic outlook for Russia, a major export market.

When it was drafting the 2015 budget, the Finance Ministry projected 3.4 percent GDP growth for this year, a forecast that was then criticized as overly optimistic. Finance Minister Rimantas Šadžius said later that he thought that the economy would grow 2.7-2.9 percent in 2015.

This year's central government budget projects 5.666 billion euros in annual revenues, not including EU funds, and 7.989 billion euros including EU funds.

A conservative government back in 2009 revised the national budget in the middle of the year due to the country's difficult economic situation, slashing revenues by around 589 million euros to 7.153 billion euros.

The Seimas (parliament) last July slightly revised the budget to increase spending on national defence in response to Russia's aggression in Ukraine.

BNS
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