–Adds Comments From FinMin Press Conference To Story Sent 10:59 GMT

BERLIN (MNI) – The German government cabinet on Wednesday passed
the budget blueprint for 2012 and the medium-term fiscal outlook through
2015.

The draft foresees federal net new borrowing of E31.5 billion next
year, declining to E22.3 billion in 2013, E15.3 billion in 2014 and
E13.3 billion in 2015.

Finance Minister Wolfgang Schaeuble, presenting the numbers at a
press conference, said he was confident of meeting the structural
federal deficit limit of 0.35% of GDP or E10 billion in 2016, as
stipulated by country’s debt limitation rule.

Germany’s total public deficit will likely fall this year below the
limit of 3% of GDP set under the EU Stability and Growth Pact, the
minister said. In 2012 it will remain below 3%, he added.

Federal expenditures are tabled in the government draft at E303.8
billion in 2012, E305.7 billion in 2013, E304.4 billion in 2014 and
E309.5 billion in 2015.

Federal tax revenue is projected at E243.0 billion in 2012, E252.9
billion in 2013, E261.4 billion in 2014 and E270.5 billion in 2015.

Other revenue is seen at E29.3 billion in 2012, E30.5 billion in
2013, E27.6 billion in 2014 and E25.8 billion in 2015. This includes,
for example, proceeds from highway tolls, distributed dividends and the
Bundesbank profit.

The budget projections are based on an expectation of 2.3% GDP
growth this year, 1.8% next year and 1.6% per year for 2013-2015.
Schaeuble cautioned, however, that it was currently impossible to
predict the economic impact of the Japanese catastrophe.

For the current year, the ministry still intends to bring federal
net new borrowing below E40 billion, despite lower transfers from the
Bundesbank, Deputy Finance Minister Werner Gatzer said last week.

“We still believe that we can meet that goal,” Gatzer said,
pointing to the improving economic picture. “Several economic research
institutes have revised their growth forecasts upward in recent days,”
he observed.

The Bundesbank announced last week that its 2010 profit fell to
E2.2 billion. The government had projected a profit of E3.0 billion in
its 2011 budget. The profit of the central bank flows directly into
government coffers.

–Berlin bureau: +49-30-22 62 05 80; twidder@marketnews.com

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