SOFIA, Jan 31 (Reuters) - Bulgaria expects to have a fiscal surplus of 470 million levs ($261 million), equal to 0.3% of economic output, in January despite a spike in spending in the first month of the year on an annual basis, the finance ministry said on Tuesday.
Bulgaria, buffeted by political turmoil and facing its fifth parliamentary election in two years in April, has decided to extend its 2022 budget into the new year until a new government is formed and comes up with its own fiscal plans for 2023.
The Balkan country, which hopes to join the euro zone in 2024, ended 2022 with a fiscal shortfall of 0.8% of economic output. The fiscal deficit on an accrual basis for 2022 stood at 2.9% of GDP, below the EU threshold of 3%, the ministry said.
The interim government has warned that increased state pensions and other social spending in the second half of 2022 amid a looming economic slowdown meant the fiscal shortfall may balloon to more than 6.6% of economic output in 2023.
The finance ministry forecast expenditures to have jumped to 4.37 billion levs in January from 3.38 billion a year ago, mainly due to increased state salaries and pensions and compensation paid to businesses to shield them from surging energy costs.
It forecast government revenues, supported by high inflation, to have increased by 12% to 4.8 billion levs at the end of January on an annual basis, mainly because of increased payments from energy producers and inflows of EU funds.
Fiscal reserves, held under a currency regime that pegs the lev to the euro, were 13.4 billion levs by the end of December, data showed. ($1 = 1.8030 leva) (Reporting by Tsvetelia Tsolova; Editing by Gareth Jones)
