Government forecasts much lower growth, a larger budget deficit and higher unemployment- 2012

The Government has revised its macroeconomic and fiscal projections. The updated Stability and Growth Programme (published April 29, 2011) forecasts growth in GDP (gross domestic product) to be 0.75% compared to the forecast published with the Budget last December.

It reduces the growth forecast for 2012 to 2.5% from 3.25% forecast at Budget time. Government is also projecting a budget deficit of 10.0% compared to a 9.4% rate forecast less than five months ago. Unemployment is projected to rise to 14.5%. These forecasts mean that the outlook now is far bleaker than that which underpinned the IMF/ECBV/EU Bailout.