Feb 5, 2016, 11:09 AM
It is true that the year will be a difficult one, because the economy has suffered a serious dent over the years, especially in respect of external shocks such as the devastating Ebola outbreak that struck the region throughout this year and the previous year’s insufficient rainfall that affected agricultural growth, inhibiting the growth rate of both tourism and agriculture.
However, economic imbalances such as excessive domestic and international debt also incurred over the years caused by other slippages as fiscal indiscipline, which took a serious toll on our economy.
These imbalances are issues that need redress if the economy should be brought back to real growth rate.
“To mitigate these challenges, as well as correct macroeconomic imbalances, government remains committed to bring the level of domestic borrowing to near zero in the medium to long term in an effort to achieve macroeconomic stability,” the budget speech stated.
Fiscal indiscipline, however, needs to be taken care of by the government if any meaningful headway could be made to bring the level of domestic borrowing to near zero in the set timeframe.
As the Finance minister said, “surmounting the challenges we face will require strict discipline in budget execution by all accounting officers”.
If this is not really seen to be done by all, it will just be another year of diminishing returns, as nothing concrete will be attained.
Excessive public debt is weighing our economy down and causing harm to our growth and real development.
“The Net Domestic Borrowing at about 8 per cent of GDP for 2016 is high,” the Finance minister has said, although he also stated that the government remains committed in making efforts to contain it to levels consistent with macroeconomic stability.
We must, therefore, tighten our belt to face what the year ahead of us will unfold.
The budget speech read by the Finance minister has spoken!
“A budget tells us what we can’t afford, but it doesn’t keep us from buying it.”