OTTAWA, Aug 25: Canada’s finance ministry on Friday announced that the federal budget surplus for fiscal year 2007-2008 is larger than expected given the country’s strong economic growth.

The budgetary surplus for 2007-08 is now expected to come in higher than the budget 2007 projection of 3bn (Canadian) dollars (US$2.9bn), the ministry said in its quarterly financial review.

The fiscal year runs from April 1, 2007 to March 31, 2008.

The higher outlook reflects in part a significant upward revision to the economic outlook for 2007 along with stronger-than-expected economic activity last year, the report said.

As well, year-to-date financial results suggest that revenues in 2007-08 will be higher than anticipated at the time of budget 2007.In June alone Canada reported a budget surplus of $2.8 billion (2.7 billion US), against $2.3 billion one year earlier.

For the first three months of the budget, the surplus reached $6.4 billion, against 5.9bn for the same period the previous year.

Canada is in a good position to report a budget surplus for the 10th consecutive year, a unique situation among the G8 group of developed nations.

Canada’s gross domestic product (GDP) is expected in 2008 to increase 2.7 per cent, not 2.9 per cent as first thought, according to revised ministry forecasts based on a consensus of private sector economists.—AFP