MercoPress. South Atlantic News Agency

Uruguay's budget surplus reached 2.3% of GDP in 2013

Government owned companies contributed 350 million dollars to the deficit

Despite a decade of sustained growth Uruguay's fiscal deficit reached 2.3% of GDP last year, which is an improvement over 2012, when it reached 2.8%, but above the government's target of 2.1%. In money terms this means the budget red was equivalent to 1.154bn dollars, including 350 million dollar losses from government owned companies.

 The primary result on the other hand (which does not include debt payments) overcame the 2012 deficit and signaled a modest surplus of 0.5% of GDP in 2013. This means the Uruguayan government had a surplus of 401 million dollars before paying for debt.

The improved performance last year can be explained because revenue grew faster than expenditure. In effect the non financial sector revenue was equivalent to 30.7% of GDP, which is 2.2 percentage points higher than in 2012. This is attributed to a higher tax volume; greater social security revenue and an improved primary result from the government's utilities.

Uruguay's revenue service, DGI, collected taxes equivalent to 17.8% of GDP in 2013, together with transfers from the government's power company, UTE, to the Energy Stability Fund. This means the central government collected 21.5% of GDP in taxes.

Social Security on the other hand also managed to climb 0.4 percentage points while the primary result of the governments companies improved 0.7 percentage points and was equivalent to 1.6% of GDP.

At the other extreme, outlays from the non financial public sector increased 1.6 percentage points to 30.3% of GDP. This because of 0.7 percentage points more in investments, particularly in optical fiber for the government's telephone company and in power generation for the government electricity monopoly, and 0.9 percentage points increase in social security expenditure.

The implementation of a national health service absorbed an additional 0.5% of GDP last year and likewise sickness pay 0.3% since pensioners were admitted into the new system.

Interests on public debt increased 0.2 percentage points over 2012 and reached 2.8% of GDP.

As to government owned companies, the deficit in 2013 climbed to 350 million dollars from 310 million. The telephone company, Antel, lost 176 million dollars and UTE, 102 million. In 2012, UTE lost 206 million and Antel, 70 million.

This was followed by the waterworks company OSE, 45 million dollars in the red and the fuels monopoly Ancap with losses of 29 million dollars. In 2012 OSE lost 10 million and Ancap 147 million dollars. The Housing program was 5 million in the red compared to 3 million in the red in 2012.

Finally the Ports Authority had a surplus of 7 million dollars and the railways administration, 2 million dollars.