Prague- The Czech government Monday approved a 2009 draft budget with a spending gap of 1.6 per cent of gross domestic product (GDP), well below the
3-per-cent limit required for adopting euro, Finance Minister Miroslav Kalousek said.

The Czech Republic is in no rush to switch to Europe's common currency as Prime Minister Mirek Topolanek wants to fix country's public finances first.

Topolanek's centre-right government abandoned a 2010 euro adoption target, while Slovakia will enter the 15-member eurozone in January and Poland hopes to join in
2011.

The budget outlines a deficit of 38.1 billion koruny (2.3 billion dollars), the lowest in 10 years and down from a planned gap of 71.3 billion koruny (4.3 billion dollars) this year.

However, the cooling Czech economy could reduce budget revenues next year. The draft assume GDP growth of 4.8 per cent that most economists no longer consider realistic.

"I can't label this indicator as conservative today. On the contrary, I have to label it as optimistic," Kalousek told reporters.

The government decided to stick to its earlier figures for the moment with a plan to freeze spending if the economic outlook worsens at the turn of the year, the minister said.

While analysts expect the Czech economy to slow amid the global financial crisis, Topolanek remains upbeat.

"I am convinced that the impact on the Czech Republic will be smaller than in neighbouring countries," he said.

The spending plan requires parliamentary approval. (dpa)