Estonia’s Budget Surplus Widened to 1.1% of GDP in 2011

Estonia’s budget surplus was revised higher to 1.1 percent of gross domestic product last year, helped by European Union aid.

The surplus compares with the previous year’s 0.2 percent and the preliminary figure of 1 percent, published in March, the Tallinn-based statistics office said on its website today. EU subsidies helped the central government, which accounts for a 75 percent share of the total budget, accumulate its first surplus in three years. The social insurance funds contributed the biggest part of the surplus, it added.

Public debt relative to economic output narrowed to 6.1 percent last year from 6.7 percent a year earlier, the office said.

Estonia, the first former Soviet republic to adopt the euro last year, is the only one among the 17 countries using the common currency to have reported budget surpluses for the last two years.

Prime Minister Andrus Ansip’s Cabinet last week agreed to raise public wages 4.4 percent next year after the opposition Social Democrats and the Center Party criticized the country’s participation in bailouts for richer European countries while it kept wages and child support frozen.

To contact the reporter on this story: Ott Ummelas in Tallinn at oummelas@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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