Thursday, July 16, 2020

Finance Minister tables 2017 estimates at the National Assembly

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By MUHAMMED S. BAH

The Minister of Finance and Economic affairs on Monday 5 December 2016, tabled before law makers the estimates of revenueAbdou Kolley recurrent and development expenditures for the  year 2017.

This budget is expected to be scrutinized by the National Assembly and debate on it on Wednesday 14 December 2016.

This tabling was also witnessed by the Minister of health and the Minister of Transport, Works and Infrastructure.

Speaking to the NAMs when the tabling the Minister of Finance Abdou Colley said it is a legal requirement which is detailed in the 1997 constitution and the Public finance Act of 2014, for the Government to present its budget to the National Assembly.

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The  constitution requires the President to instruct the Minister of Finance to prepare and submit to the National Assembly, at least 30 days before the end of each Financial  Year; the estimates of Revenues and Expenditures of the Gambia for the following year.

The Honourable Minister said the estimates shall include any estimates, which under the 1997 constitution, are to be submitted directly to the President by the Chief of Justice or any authority for presentation by the President of the National Assembly.

“During the period 2011-2015, average real GDP growth moderated to 2.4 per cent, well below the 5.6 per cent average growth registered over the period 2007-2010. This decline in the average real GDP growth is the result of shocks in the two main growth driving sectors of the economy – Agriculture and Tourism. Since 2011, Agricultural sector contribution has consistently declined, from 24 per cent to 21 per cent in 2015. The Services sector on the contrary, has seen its contribution increase from 62 per cent in 2011 to 64 per cent in 2015, whilst contribution of industry (15 per cent) remains unchanged over the review period,” he disclosed.

The Finance Minister added that this signals inadequate transformation and diversification of the economy, as a result increasing the vulnerabilities of the economy to external shocks in the two major sectors of the economy.

He said that Consumer price inflation decelerated to 6.0 per cent in December 2015, from 6.9 per cent in December 2014. This was primarily as a result   of  the   decline  in  food  inflation  from  8.4   per   cent  in December  2014  to  4.8 per  cent  in December  2015.

According to Mr. Colley  In contrast, non-food inflation increased from 4.8 to 5.2 per cent in December 2015.  Central  Bank  of The  Gambia’s measure  of core  inflation, which  excludes  the  prices  of volatile  food  items,  utilities  and energy, decreased  to 6.7 per cent in December 2015  compared  to 6.9  per  cent  in  December   2014.

“However, downside   risks of increases in international commodity prices such as rice, flour, sugar, oil prices, remain.  In addition, a further depreciation of the Dalasi against   the   four major trading currencies   may cause inflation to rise above the anticipated 5.2 per cent in 2017 before stabilizing to 5.0 per cent in the medium term” He disclosed.

The   Government will therefore continue      to consolidate     the macroeconomic gains recorded during the past years. While the global environment remains challenging, Government remains steadfast and determined to pursue the fiscal, financial and structural reforms needed to steer the economy into a sustainable path.

He also noted that on the fiscal front, budget execution is mired by budget overruns, resulting in substantial domestic borrowing to finance the deficit. As of end 2015, Net Domestic Borrowing (NDB) reached D4 Billion dalasi, which is equivalent to approximately 10 per cent of nominal GDP. This, compared  to  a target of 1 per cent  NDB  to  GDP,  highlights growing  fiscal   pressures  that  have led  to an unsustainable  debt situation.

Foroyaa will publish the full text of the presentation by the minister.

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