ECONOMY

In Brief

Cyprus Finance Ministry says deficit is rising NICOSIA (Reuters) – Cyprus is facing a rising public deficit, its Finance Ministry said yesterday, giving no other response to International Monetary Fund calls for it to cut a shortfall the Fund says will hit 3.9 percent of GDP this year. «Public finances are currently facing challenges and the public deficit is showing an upward trend, primarily because of the impact of the world crisis on public revenue,» the Finance Ministry said in a statement. It did not give a new forecast for the public deficit for this year. Authorities had previously said they would strive for it to remain below 3 percent, a threshold among European Union members. Cyprus’s sources of revenue have dried up because of the economic downturn with fewer European tourists visiting its beaches, and a slump in a once buoyant property market which had kept public coffers in surplus over previous years. Authorities would continue to monitor the situation and take corrective measures if required, the ministry said without elaborating. The IMF said in a report on Monday it expected the island nation to register a 3.9 percent deficit in 2009 after posting surpluses in 2007 and 2008. In the statement following its regular consultation with Cyprus the IMF said the budget deficit would need to retreat by 0.5 to 0.75 percent per year. It recommended a «significant upfront correction» to avoid unfavorable debt-deficit dynamics. Bulgarian gov’t will tap EU aid for jobless Bulgaria’s new government will tap European Union aid in efforts to stop unemployment in the bloc’s poorest nation reaching double digits, Social Minister Totyo Mladenov said. «Our efforts from now on… will be to tame unemployment’s rampant growth,» Mladenov told Reuters in an interview late on Monday. «If it goes over 10-12 percent, the situation will become dangerous for the whole economy.» Labor authorities this week launched a crackdown on the employment of workers in the unofficial «gray economy,» he said. Bulgaria, with a population of 7.6 million, has been hard hit by the global economic downturn and went into recession earlier this year after 12 years of growth. Many foreign investors have left and a growing number of companies are cutting production. This pushed the unemployment rate up to 7.6 percent in July from 6.3 in December and 5.9 percent a year ago. (Bloomberg) Turkish bonds Turkey’s treasury is set to meet or exceed its sale target of 22 billion liras ($15 billion) in lira- denominated bonds for August, the biggest monthly borrowing in the remainder of the year. The treasury has borrowed a gross 21.4 billion liras of lira-denominated debt this month after selling 1.53 billion liras of 2014 bonds in a noncompetitive auction yesterday to primary dealers and public institutions. (Bloomberg) Stock rally Unye Cimento Sanayii & Ticaret, a Turkish producer of cement and clinker, surged in Istanbul trading after saying profit was 17.1 million liras ($11.4 million) in the second quarter. Unye added 32 kurus, or 8.4 percent, to 4.14 liras in mid-session trade, the biggest increase since January last year. (Bloomberg)