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Mar 13, 2014

National Budget 2014 by the numbers

Debate of the proposed budget for the new financial year begins next week; both sides of the aisle in the House of Representatives are going through the budget with a fine tooth comb. The theme for the 2014-2015 Budget is Bettering People, Building Belize – A Budget for all. Tonight, Isani Cayetano has an overall look at budget and how government proposes to fund expenditure of a billion dollars.

 

Isani Cayetano, Reporting

The proposed national budget for 2014, prepared by the Ministry of Finance was presented by Prime Minister Barrow in the House of Representatives last Friday. Belize.  The financial plan focuses on an initial primary surplus of one percent of the gross domestic product, not including the remaining interest payments on government’s existing debt.  The GDP, an overall income exclusive of foreign direct investment, grew by a sheer zero point seven percent last year.  The difference in GDP between 2012 and 2013 is a three point three percent contraction of the growth rate of the economy.  Despite the significant reduction, government plans on spending one billion dollars during the upcoming twelve months.  That figure is being offset against a forecasted revenue of nine hundred and fifty-six million dollars, an overall shortfall of fifty-seven million dollars or one point seven percent of GDP.

 

Additionally, the cost of paying off government’s debt in installments amounts to seventy million dollars.  That’s a total of one hundred and twenty-seven million dollars between the deficit and the loan amortization.  To cover the outstanding balance G.O.B. will take on a three-pronged approach which includes a forty-eight million dollar loan to fund its Capital Three Expenditure Program, twenty million dollars in budget support financing from the Taiwan International Cooperation and Development Fund and fifty-nine million dollars from Venezuela’s PetroCaribe initiative.

 

Where revenue is concerned, G.O.B. has identified five primary sources which it hopes will meet its nine hundred million dollar target in projected collection.  The following pie chart indicates that the largest sum will be derived from taxes on goods and services, a total of three hundred and fifteen million dollars.  A secondary raft of roughly two hundred and fifty million dollars comes from income tax, while the third and fourth tranches of two hundred and twelve million dollars and a hundred and twenty-one million dollars, respectively, will come from international trade and transactions and non-tax revenue.  If government realizes that quantum by the end of March 2015, then public officers, senior managers and teachers would continue to benefit from the salary adjustment.  The existing agreement sees a commitment of half of the difference in actual recurrent revenue performance going forward.

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