Poland 2010 deficit to almost double to euro12.7 bn

WARSAW, POLAND: Poland's 2010 state budget deficit is to reach euro12.7 billion ($18 billion), almost double this year's gap, the finance minister said in an interview published Saturday.

``We are planning that (the deficit) will significantly increase compared to 2009 and will be 52.2 billion zlotys,'' Jacek Rostowski told the Rzeczpospolita daily.

He said the government will cut spending to a minimum to keep debt under the level of 55 percent of gross domestic product.

The draft budget is to be discussed by the Prime Minister Donald Tusk's cabinet at its next meeting on Tuesday.

Rostowski said part of the deficit was due to a badly needed construction program that will build new highways across the country, as well as a 7-percent pay increase for teachers.

The 2009 deficit is estimated at euro6.6 billion ($9.4 billion). Poland posted growth of 1.1 percent in the second quarter of this year and has so far avoided going into the red, despite the global economic downturn. Economists say a healthy banking system, steady home demand and flexible local currency, the zloty, are helping Poland weather the global recession.