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Vatican's finances best in 8 years

Reports surplus of $12.4 m in 2005

VATICAN CITY -- The Vatican yesterday released its best financial report in eight years, saying it had a surplus of 9.7 million euros ($12.4 million) in 2005 despite extraordinary costs of 7 million euros ($8.9 million) for the funeral of Pope John Paul II and the election of his successor.

Cardinal Sergio Sebastiani, who heads the Vatican's office for economic affairs, called it ``good news" as he presented the Holy See's annual financial statement after it was examined last week by international auditors and presented to Pope Benedict XVI.

In recent years, the Vatican's accounts have been battered by labor costs, a falling dollar and the costs of the Vatican's growing diplomatic mission while specialists expressed concern that donations might drop from dioceses in the United States and elsewhere struggling to meet settlements in the sex-abuse scandal.

In 2004, the Vatican netted 3 million euros after four years in the red.

Sebastiani said the transition period following the death of John Paul in April 2005 and the election of Pope Benedict XVI cost 7 million euros ($8.9 million), some of it due to bonuses paid Vatican workers upon the election of a new pope.

But much of those expenses were covered by when millions of pilgrims came to Rome for the ceremonies and visited Vatican museums, Vatican officials said. Some 3.8 million people visited the museums last year, even more than during the millennium Holy Year in 2000.

The Vatican depends heavily on contributions from worldwide dioceses, which held steady around 73 million euros ($92.9 million). Contributions to Peter's Pence, as individual donations to the pope are known and are listed in dollars, reached $59 million, up 15 percent from 2004.

Sebastiani said both Catholic dioceses and individuals in the United States remain the No. 1 donors to the Holy See, ahead of Italy and Germany.

The financial statement did not give a full report of costs and expenses, but gave some hints of the financial doings: The Vatican Radio and its daily newspaper lost money, while its TV operations and publishing house turned in surpluses.

In particular its investments, reported to be in safe if low-yield possibilities such as government bonds, closed with a profit of 43 million euros ($55 million). The Vatican attributed this to improvement in worldwide markets.

John Paul ordered an annual financial disclosure in 1981 as part of his efforts to debunk the idea that the Vatican is wealthy.

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