Budget deficit narrows in 2022 but limited fiscal space remained
The government’s budget balance settled into deficit territory again but proved lower in 2022, as revenues scored the benefits of a reopened domestic economy.
However, concerns loomed as a limited fiscal space continued to narrow spending on sorely needed socioeconomic programs.
Data released by the Bureau of the Treasury on Wednesday showed that the budget deficit was trimmed by 3.35% year-on-year to P1.6 trillion in 2022 as revenues outpaced government spending. This was a better outturn compared to the P1.7 trillion budget gap recorded in 2021.
The deficit means the government continued to spend beyond its means, as authorities try to meet the country’s needs while revenues from tax and non-tax collections recover from a pandemic-induced slump in economic activity. To bridge the budget gap, the government would have to borrow money from creditors.
The budget gap was equivalent to 7.33% of the gross domestic product, lower than 8.6% in 2021 but higher than the government’s target of 6.9%.
This report’s information was first seen on Zawya.com; to read more, click this link.
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