Vatican, Jul. 10, 2008 (CWNews.com) - The Vatican reported a budget deficit of $14.3 million for 2007, breaking a string of 3 straight years of surpluses.
The primary cause for the deficit, Vatican officials said, was the sharp decline in the value of the US dollar. Americans are the most generous donors to the Holy See, and many contributions from other countries are denominated in dollars.
The Vatican released financial statements on July 9, after a meeting of the council of cardinals who supervise the financial affairs of the Holy See. The financial statements were presented by Archbishop Velasio De Paolis, the president of the Prefecture for Economic Affairs.
The Vatican brought in €236.7 million ($373.6. million) in 2007, but spent €245.8 million ($387.9 million), producing a shortfall of over €9 million ($14.3 million). From 2004 through 2006 the budget had run in the black, producing a total surplus of €15.2 million for that 3-year period.
These budget figures show the financial activity of the Pope, the Roman Curia, and the offices affiliated the Holy See itself, but not the Vatican city-state, which keeps a separate budget. The city-state produced a surplus of €6.7 million, down from €21.8 million in 2006.
Vatican investments yielded a surplus of only €1.4 million in 2007, as against €13.7 million in the previous year. The difference was "due above all to a sudden very strong reversal of trend in fluctuations of the rate of exchange, especially of the US dollar," the Vatican explained in its financial statement. By contrast the Vatican's real-estate investments-- which are denominated in euros-- showed a modest gain, from €32.3 million in 2006 to €36.3 million last year.
The Vatican's media efforts accounted for the greatest losses on the budget. While the Vatican printing office, publishing house, and television center all produced substantial profits, the overall media operation showed a deficit of €14.6 million, "substantially due to the deficit of Vatican Radio and the publication costs of L'Osservatore Romano," the Vatican statement indicated.
Most of the Vatican's congregations, commissions, and tribunals produce virtually no revenue, and rely on donations and investment income for their support. The Vatican receives donations through the annual Peter's Pence collection and contributions from episcopal conferences. The July 10 statement took note of one donor "who has chosen to remain anonymous" who provided a gift of $14.3 million
The Peter's Pence collection brought in €50.8 million last year, a major drop from the €74.6 million collected in 2006. Again the slide in the value of the dollar took a toll, since Americans were the leading contributors with a total of €11.9 million.