BUSINESS

Cash deficit just short of 25 bln euros

The state?s cash deficit amounted last year to 24.88 billion euros, or 11.5 percent of the country?s gross domestic product, according to data issued on Thursday by the Finance Ministry.

It therefore seems that despite the harsh new tax measures and the cuts to civil servants? pay in addition to to pension reductions, the government has failed to rein in the cash deficit, which appears to be 5 billion euros bigger than the general government deficit that the country?s creditors use to assess Greece?s performance.

At the end of December 2011, the Greek state?s overdue debts to suppliers came to 5.73 billion euros, compared with 6.66 billion euros at the end of November.

Out of that 5.73 billion euros, 589 million comprised ministry debts. The rest was made up of the debts of hospitals, local authorities, social security companies and other general state corporations.

The ministry suggested that the cash deficit grew in 2011 due to the payment of outstanding debts to the private sector from previous years, totaling 4.1 billion euros. A significant share of that concerns the debts of hospitals to their suppliers, which were settled with bonds within last year.

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