UDPATE 1-Slovak budget gap jumps, tightening set for 2011

                                
 * 2010 central budget gap far above original target
* Plans some of fastest deficit cutbacks in Europe
                                
 * Analysts say planned consolidation achievable
                                
 * FinMin: 2010 fiscal cap could be touch below 7.8 pct/GDP
                                
 
                                
 (Adds finance ministry comment in paragraph 7)
                                
 By Martin Santa
                                
 BRATISLAVA, Jan 3 (Reuters) - Slovakia's budget deficit came
in well above the original target in 2010, data on Monday
showed, as the country braces itself for the impact of draconian
fiscal tightening this year, without choking the economy growth.
  The central state budget gap, forming the major part of the
overall public sector deficit, widened to 4.4 billion euro
($5.89 billion) last year from 2.8 billion euros in 2009
[ID:nLDE7020C8].
                                
 The finance ministry updated its full-year 2010 budget
balance expectation to a 4.54 billion euro gap in December, from
the original 3.75 billion, planned by the previous leftist
cabinet prior to mid-year elections.
                                
 Slovakia's debt to gross domestic product ratio is far lower
than most of its euro zone peers, but it has been rising fast.
It is expected to grow to 47.2 percent of gross domestic product
in 2012, versus an EU average of above 80 percent.
                                
 The centre-right cabinet of Prime Minister Iveta Radicova,
in power since July, has pushed through tax rises and spending
cuts worth 1.75 billion euros to back-up its plan to slash the
fiscal gap to 4.9 percent of gross domestic product this year.
                                
 The latest available forecast for the overall public sector
in 2010
                                
 The finance ministry said the overall public sector gap --
 -- including the state and regional budgets, the pension system
and health-care insurers -- may be slightly below the expected
shortfall of 7.84 percent of GDP.
                                
 Analysts said the central state gap jumped in part due to
the inclusion of pension reform costs, worth some 700 million
euro last year, directly into the central budget instead of
overall public finance balance, as done in the previous years.
                                
 Analysts said the 2011 fiscal plan -- a nearly 3 percentage
point deficit reduction in relation to GDP -- was achievable if
the government is flexible on spending.
                                
 "It will be important how the government reacts if some of
its estimates do not develop as expected - it is crucial to be
able to adjust expenditures during the year, in case of smaller
revenues," said Maria Valachyova, senior analyst with Slovenska
Sporitelna.
  The Finance Ministry expects the heavily export-reliant
economy is expected to grow by 3.3 percent this year, down from
estimated 4.0 percent rise in 2010, mainly on external
developments and the impact of austerity measures including tax
hikes.
                                
 (Additional reporting by Petra Kovacova; editing by Patrick
Graham)