Cyprus Finance Minister submits state budget to Parliament

Finance Minister Michalis Sarris has submitted to the House of Representatives the state budget for 2008 which provides for revenues of CYP 3,3 bln (EUR 5,64 bln) and expenditure of CYP 3,8 bln (EUR 6,5 bln).

He handed over the state budget, which is the last to be presented in Cyprus pounds before the country adopts the Euro in January 2008, to House of Representatives President Demetris Christofias who will in turn pass it on to the House Finance Committee for debate prior to a vote on the parliament floor.

According to Sarris, the state budget for 2008 provides for a decrease of the fiscal deficit to 0,5%, a reduction of the public debt to 53% of gross domestic product (GDP) and an increase of the development and social expenditure.

“This budget continues the economic policy of the Government and is based on three aspects, namely the support of the macroeconomic stability, of development and social cohesion”, the Minister told reporters after his meeting with Christofias.

The development expenditure for 2008 would reach CYP 550 mln (EUR 940,2 mln), he said.

Asked about the financial results of 2007, he said that the growth rate will reach 4%, inflation will be around 2%, unemployment rate will record a decreasing trend, reaching 4,3%, and per head income will for the first time exceed 90% of the EU average.

The fiscal deficit for 2007, he added, is expected to reach 1% whereas the public debt will reach 60% of GDP.

Regarding the submission of supplementary budgets, the Minister said that in 2008 the Government would avoid submitting as many as in last years.

EU Finance Ministers have set the permanent conversion rates of the Cyprus pound against the euro at 0.585274.