Vatican announces deficit for 2001 _ first time in red in nine years

Friday, July 5th 2002, 12:00 am
By: News On 6

VATICAN CITY (AP) _ The Vatican reported a deficit Friday of about $3 million for 2001 _ the first time in the red in nine years _ due to the worldwide financial slump aggravated by the Sept. 11 terrorist attacks.

Increasing financial contributions from dioceses around the world were not enough to balance losses from the global financial slowdown, economic chief Cardinal Sergio Sebastiani said.

He blamed the ``unfavorable course of the world economy during the year, heavily aggravated by the attacks of Sept. 11'' for the fall in investment income.

The Vatican's annual financial statement showed revenue of $173,525,000 and costs of $176,587,000 million, for a deficit of $3,062,000.

The Vatican went through 23 money-losing years until 1993 when bishops from around the world agreed to directly assist the Vatican.

Sebastiani provided no breakdown from individual countries but in the past, dioceses in Germany and the United States have been the top donors.

But the scandal of sex abuse by clergy that has rocked the church in the United States since January has raised concern that American Catholics may hold back on further contributions.

The Italian cardinal said he had no information on contributions so far this year.

The biggest expenses are personnel costs for the Vatican's 2,700-strong work force. An expanding diplomatic presence around the world has also led to increased expenses.