Schlettwein to table Mid-term budget review next week

27 Sep 2017 18:40pm
WINDHOEK, 27 (NAMPA) – Minister of Finance Calle Schlettwein will table the Mid-Year Budget Review in the first week of October this year.
This is the second time, the finance minister will table the mid-term review, which is aimed at announcing policies to support the economy and address micro-fiscal risks.
Schlettwein made the announcement at a media briefing in the capital on Thursday.
In 2016, the Finance Minister announced the fiscal consolidation policy framework in the Mid-Year Budget Review through which Government aligned expenditure closer to revenue, thus reducing growth in public debt and budget deficit.
The consolidation plan included budget cuts for ministries and agencies, reduction in travelling and subsistence allowances and shelving some of the big projects such as Kudu Gas, Hosea Kutako International Airport, and construction of the new Parliament building.
This year, Schlettwein said, the fiscal consolidation policy stance remains the underpinning budget policy as expressly stated in in the Medium-Term Framework and 2017 budget policy statement.
He indicated that this policy framework hads suffered transitory interruption as a result of the unreported outstanding invoices from the past fiscal year.
“These spending arrears from the past fiscal budgeted and unbudgeted are attracting the revision in the credit rating opinion by Moody’s,” he said.
In August this year, Moody’s downgraded Namibia from Baa3 to Ba1 and maintained the negative outlook.
The key factors for downgrading Namibia include, erosion of Namibia's fiscal strength due to sizeable fiscal imbalances and an increasing debt burden, limited institutional capacity to manage shocks and address long-term structural fiscal rigidities and risk of renewed Government liquidity pressures in the coming years.
“We will have to carry through with fiscal consolidation policy to achieve the expressed objective of stabilising growth in public debt and eventually reducing the debt level,” said Schlettwein.
In July this year, President Hage Geingob indicated that the country’s economy was put through the brunt of the downturn and is now on a recovery path.
Geingob said Namibia’s consolidation plan is deemed to be credible and has earned the country the status of being the only sub-Saharan African country which has been issued a Eurobond at investment grade rating.
The President said the recovery is supported by facts that Namibia received significant rainfall during the just-ended rainy season.
“We observed recovery in the agricultural sectors, both crop production where a bumper harvest is expected and livestock farming, where there has been an uptick in meat prices,” he said.
Geingob also said some projects were shelved as a result of poor governance in the tender awarding process.