The Gambia is a tax based public sector economy. Government does not rely on sovereign national wealth to provide social services. It relies basically on taxation. Income and corporate taxes are also contributing marginally to the government budget. Taxes on goods and services constitute the lion share.
With a narrow tax base, government has been relying on domestic borrowing and grants to meet its expenditure. There is promise just like that made by other previous governments that financial discipline leads to reduction of domestic borrowing and the domestic debt.
The report of the monetary policy committee does not give comfort to all those who are interested in the health of the economy. The report of growth in domestic debt from 31.2 billion dalasis to 31.8 billion dalasis is an early warning signal that the battle against indebtedness, which President Jawara said will continue until dooms day is yet to be won. It is therefore important to realistically assess what is going wrong and proffer a realistic solution. Foroyaa will continue to monitor the state of the economy and share findings.