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Jun 29, 2012

Draft Estimates for 2012-2013

Dean Barrow

The P.M. says that provisions are also being made for support to alternative education, especially the community resource centers in the south side of Belize City, and, the ITVET. The National Health Insurance programme will also continue and funds have been to the upgrade of the Toledo District Highway to the Guatemalan Border. But the budget presentation was about crunching the numbers. The Prime Minister indicated early in his presentation that the budget always depends on grants as well as external loans to fund infrastructure projects. During the presentation on draft estimates Barrow said the Gross Domestic Product will grow only at two percent.

 

Dean Barrow

“The summary of the draft estimates for fiscal year 2012/2013. They have been prepared on the assumption that nominal GDP will grow, in real terms, by about two percent over the fiscal year; reflecting projected increases in the primary and services sectors and continued strong public sector investment especially in road and bridge infrastructure. We are also assuming a moderate increase inflation from one point five to two percent—although this may turn out to be tempered by what we are seeing; the sharp decline in world oil prices. Mr. Speaker, for the proposed Budget for Fiscal Year 2012-2013, we have set a preliminary target for the Primary Surplus of two percent of G.D.P. and a target for the Overall Deficit of two point four seven percent of G.D.P. Total Revenue and Grants are estimated at eight hundred and sixty-two point six million. This is an increase of twenty-six point nine million over the expected outturn for the last fiscal year. Total Expenditure is estimated at nine hundred and thirty-seven point nine million. Taken together, the result is an overall deficit, before Amortization, of seventy-five point two million; equal to the two point four percent of G.D.P. The provision for amortization payments has increased slightly to sixty-four point six million which, when added to the Overall Deficit, results in an Overall Financing Requirement of one hundred and thirty-nine point eight million. This financing requirement will be met from the following already secured sources: one, draw-downs from our multi-lateral development partners of approximately sixty-two point five million in project-related, external loans committed to Cap III; two, a drawdown of Belize twenty million from a multi-year, Republic of China Budget Support Loan. Unlike with the Russians, this is in the bank. It is a loan that was started in 2009 and continues on an annual basis with yearly trances.  So that twenty million is secured. And three, domestic financing of approximately thirty-one point two million together with a modest drawdown of about eleven million from deposits in the domestic banking system.”

 

Barrow said that the government continues to finance capital program largely through borrowings from bilateral and multilateral sources on concessionary terms, which have below- market interest rates and extended repayment periods.

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