BUENOS AIRES (Dow Jones)–Argentina’s Vice President Amado Boudou said Tuesday the government’s primary deficit widened to 8.11 billion pesos ($1.87 billion) in December amid a big increase in spending.
That deficit was considerably larger than the ARS2.20 billion deficit reported in December 2010, according to Economy Ministry data.
Argentina ran a primary surplus of ARS4.92 billion in 2011, Boudou said at a press conference.
The government’s primary surplus was ARS25.12 billion in 2010.
Including debt payments, the government reported a fiscal deficit of ARS22.35 billion in December, and a deficit of ARS30.66 billion for the full year, Boudou said.
Faced with a shrinking fiscal surplus, the government has started to eliminate costly water, gas, electricity and public transportation subsidies for wealthy residents of the capital Buenos Aires and some industries.
Argentina faces more challenging economic conditions ahead owing to more-sluggish demand for its products from top trading partner Brazil, a drought that has damaged grain production, and high inflation.
Boudou said the economy grew 9.2% for a second consecutive year in 2011. The Central Bank of Argentina’s latest forecast puts economic growth at between 4.5% and 7.5% this year.
-By Ken Parks, Dow Jones Newswires; 54-11-4103-6740, ken.parks@dowjones.com
–Alberto Messer contributed to this article.
Source: online.wsj.com