Argentine Senate votes 2009 budget into law

BUENOS AIRES, Nov 5 (Reuters) - Argentine senators voted the 2009 budget into law on Wednesday, despite opposition criticism that it was drawn up before the global financial crisis.

Next year's budget sees Latin America's No. 3 economy expanding by 4 percent, with inflation of 8 percent.

Argentina's economy has grown at rates above 8.5 percent in the last five years, but the government forecasts slower 2008 growth of 6.6 percent.

Despite the strong growth of recent years, the government has forecast 4 percent expansion in its annual budgets, saying it is best to be conservative.

Critics have seen the underestimation of growth as a ploy to spend extra revenue without having to get approval from Congress. However, economic analysts say 4 percent growth may be more realistic for 2009.

Ruling party Sen. Fabian Rios, who heads the Senate's budgetary committee, defended the budget in comments to local media and criticized those "who say the budget doesn't contemplate reality."

Soy is Argentina's top export earner and prices have fallen more than 40 percent since record highs in July. Exports of the oilseed are taxed heavily, making the country's finances more sensitive to price swings.

Next year's budget estimates a trade surplus of $11.98 billion, slightly down from this year's estimated surplus of $12.23 billion.

The primary budget surplus is seen at 3.27 percent of gross domestic product, up from the 2008 outlook of 3.16 percent.

Argentina's financing needs will jump next year, and a recent government announcement of a plan to nationalize state pension funds was read by investors as a desperate effort to secure cash to repay its debts. (Reporting by Helen Popper; Editing by Jan Paschal)