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Experts warn of precarious financial situation
Economics

Experts warn of precarious financial situation

21.03.2012 From our online archive
Budget plans for the years 2013 to 2015 present a pessimistic view of Luxembourg's financial situation, which might slip above the 3% deficit rate proposed by the EU's stability pact, experts warn.

(CS/jw) Budget plans for the years 2013 to 2015 present a pessimistic view of Luxembourg's financial situation, which might slip above the 3% deficit rate proposed by the EU's stability pact, experts warn.

Financial experts from Statec and the ministry of finance expect 1.5 billion euros to be missing in the budget in 2013. This would bring the deficit to 3.5% of the GDP, above the 3% stability mark set by the EU.

The situation is hardly looking more promising for future years with deficits over 3% projected for 2014 (3.1%) and 2015 (3.3%).

Public debt is estimated to rise to 21% of GDP in 2012, with a further rise in 2014 to 24%.

Unemployment, however, is expected to go down with an estimated 22,000 new jobs between 2012 and 2015, together with an expected economic growth of 3.7%.

Luxembourg's political parties did not seem surprised by the predictions with the opposition demanding that the government counter the negative outlook with higher investments.

In response, finance minister Luc Frieden announced a press conference for Wednesday evening with a parliamentary debate set to take place next Tuesday.