Turkish October budget deficit widens in economic downturn

Turkey’s budget posted a deficit of 5.4 billion liras ($994 million) in October, a 64 percent increase on a year earlier.

The budget, excluding interest payments on debt, recorded a deficit of 1.2 billion liras versus a year-ago surplus of 197 million liras, the Treasury and Finance Ministry said on its website on Thursday.

Turkey has pledged to curtail budget spending to meet more stringent goals in its economic programme, which are designed to pare an inflation rate of 25.2 percent. But the promises come amid a severe economic downturn, which has prompted the government to announce tax cuts and other steps to spur growth.

Budget spending rose an annual 20.2 percent to 67.5 billion liras, outpacing 17.6 percent growth in revenues, which totalled 62.1 billion liras, the ministry said. Tax revenue increased just 6.5 percent.

The budget deficit for the first 10 months of the year increased to 62.1 billion liras, almost double the 35 billion liras reported for the same period of 2017.

The budget recorded a surplus, excluding interest payments on debt, of 2.5 billion liras in the first 10 months versus a surplus of 15.2 billion liras a year earlier.