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UPDATE 1-Poland to cut growth forecast, spending-source

Published 11/25/2008, 02:02 PM
Updated 11/25/2008, 02:04 PM

WARSAW, Nov 25 (Reuters) - The Polish government will cut its official 2009 growth forecast to a preliminary 3.8 percent from 4.8 percent, a senior source at Prime Minister Donald Tusk office told Reuters.

The government will also cut budget expenditures by up to 2 billion zlotys in order to keep the planned budget deficit at 18.2 billion zlotys.

"Growth in 2009 will be revised to 3.8, the final decision depends on the Finance Minister. It will definitely not be 4.0 or 3.5, preliminarily it was decided it will be 3.8," a source said.

The government was under pressure from the economists to revise its next year's growth forecast amid the financial turmoil and global slowdown.

Economists had slashed their next year expansion expectations for the Eastern Europe's largest economy, to 3.5 percent, as the economies of its main export partners experience either a recession or major slowdown.

The government will decide on the final changes to its next year's budget plan, including macroeconomic forecasts, on its sitting on Dec 2. (Reporting by Gabriela Baczynska, writing by Patryk Wasilewski)

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