Next year budget is projected at Denar 169 billion (about EUR 2,77 billion), with revenues at Denar 159 billion (about EUR 2,58) and a deficit equivalent to 2.5% of the gross domestic product (GDP), Vice-Premier and Finance Minister Zoran Stavrevski told reporters Wednesday.

The GDP growth is projected at 4,5 per cent along with a 2,5 per cent annual inflation rate. Capital investments are to increase for 28 per cent, Stavrevski said after the government gave green light to the draft budget, which also requires the Parliament's approval.

The draft budget, Stavreski said, was based on the analysis of economic trends in Macedonia.

"According to projections the economic activity in 2011 should be mainly supported by larger investments, which should be higher for 8,5 per cent, thanking mostly to increasing the budget capital investments," Stavrevski said at a press conference.

The growth of budget revenues and expenditures have been projected at 5,7 percent, slightly lower than previous years due to the economic trends in Europe, Stavreski said.

"However, we expect to realize the projected GDP growth of 4,5 per cent, considering the capital investments and other projects that have been foreseen in the (draft) budget," Stavrevski said.

The draft budget is realistic and attainable considering the present circumstances, namely the economic situation in Europe, across the globe, Stavreski said, pointing out that it is incorporating all priorities of the Government's program.

More funds have been earmarked for the education, health care and infrastructure, including a construction of free economic zones, he said.