Belka announces basis for the 2003 budget draft, lower deficit expected

Finance Minister Marek Belka yesterday presented some of the key economic assumptions of the 2003 budget draft, which predicts GDP growth at 3.1% and inflation of 3%. Belka said next year's budget expenditures would increase in line with the "inflation + 1 percentage point" rule, which should result in lowering the budget deficit. According to unofficial sources, the Finance Ministry's budget draft envisages a deficit equal to 3.6% of GDP. Belka also said that the government would unfreeze salaries in the public sector, which will not rise this year, but would increase by 4% in 2003. Analysts view the Minister's economic growth forecast for next year as reasonable, but have reservations about the anticipated inflation rate, which they believe will be closer to 4% in 2003. (Gazeta Wyborcza, p. 21; Rzeczpospolita, p. A1) T.J.