BUENOS AIRES Dec 13 Argentina still expects to
finish 2016 with a budget deficit worth 4.8 percent of gross
domestic product despite a sharp increase in end-of-the-year
spending, vice cabinet chief Gustavo Lopetegui said on Tuesday.
In a decree published on Monday, the government altered the
budget to boost public spending by about 130 billion pesos ($7.9
billion) to pay subsidies and retirees and to service debt.
Lopetegui said the government had already accounted for the
increase when it projected the deficit. The idea that the
spending hike would increase the deficit was an "incorrect
interpretation," he told journalists.
Since taking office one year ago, center-right President
Mauricio Macri has tried to control the ballooning budget
deficit inherited from former populist President Christina
Fernandez, slashing subsidies for natural gas consumption and
proposing to reform the tax code.
But his government has avoided drastic cuts that could
threaten the economy's recovery from a long recession or curb
his popularity before next year's midterm elections.
The 2017 budget, announced in September and approved by
Congress last month, includes a deficit worth 4.2 percent of
GDP, compared with earlier expectations for a 3.3 percent
End-of-the-year spending increases were common under
Fernandez's government, which approved the budget that the
current administration has worked with this year.
"We have been governing all year with a budget approved by
the former government ... which did not reflect what was later
going to happen in reality," Lopetegui said.
($1 = 16.0300 Argentine pesos)
(Reporting by Luc Cohen; Editing by Lisa Von Ahn)