Vatican reports $3 million deficit

By Victor L. Simpson
Associated Press

VATICAN CITY — The Vatican reported its first deficit in nine years yesterday — about $3 million for 2001 — and blamed the shortfall on the worldwide financial slump aggravated by the Sept. 11 attacks.

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

Sebastiani presented the Vatican's annual financial statement showing revenue of $173,525,000 and costs of $176,587,000 for a deficit of $3,062,000.

He blamed sluggish economic conditions, which were aggravated by the Sept. 11 attacks for the decline.

The Vatican went through 23 money-losing years until 1993, when bishops from around the world agreed to assist the Vatican directly. These contributions reached $51.9 million in 2001.

In the past dioceses in Germany and the United States have been the top givers.

The scandal of sex abuses by clergy that has rocked the church in the United States and other countries has raised concern that some Catholics may withhold contributions. Sebastiani said he had no information on contributions this year.

The biggest expenses are personnel costs. The Vatican's expanding diplomatic presence worldwide has also led to increased expenses.