Turkey's September Budget Deficit Narrows From Year Ago as Economy Grows

Turkey’s budget deficit narrowed in September from a year earlier, the Finance Ministry said.

The gap in the month was 6.9 billion liras ($4.9 billion), down from 9.5 billion liras a year earlier, the ministry in Ankara said on its website today. The so-called primary deficit, before interest payments on debt, also narrowed to 2.9 billion liras from 4.5 billion a year earlier.

Turkey on Oct. 10 revised its full-year deficit forecast to 44.2 billion liras from 50 billion liras as faster-than-forecast growth helped generate higher revenues. The revised plans see a deficit next year of 33.5 billion liras, a forecast that’s “realistic, cautious even,” Finance Minister Mehmet Simsek told reporters today.

The deficit in the first nine months of this year was 21.3 billion liras, about half the gap in the same period of 2009. Excluding payments on interest, the budget had a surplus of 18 billion liras.

Budget revenues rose 20 percent in the year to September, while non-interest spending increased 12 percent and expenditure on interest fell 14 percent, the ministry said.

The economy may expand 6.8 percent this year, according to government forecasts. That’s almost double the estimate of 3.5 percent made when the budget was drawn up in October last year. The forecast for next year is 4.5 percent.

Simsek said the government will submit 2011 spending plans to parliament today for debate.

To contact the reporters on this story: Steve Bryant in Ankara at sbryant5@bloomberg.net; To contact the reporter on this story: Ali Berat Meric in Ankara at americ@bloomberg.net

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