1 / 15

Review of the 2010/2011 National Budget

Review of the 2010/2011 National Budget. Kyren Greigg Department of Economics UWI, St. Augustine. Demas/ Rampersad Series September 9, 2010. Presentation Outline. The present economic environment Budget assumptions & Arithmetic

hall
Télécharger la présentation

Review of the 2010/2011 National Budget

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Review of the 2010/2011 National Budget Kyren Greigg Department of Economics UWI, St. Augustine Demas/ Rampersad Series September 9, 2010

  2. Presentation Outline • The present economic environment • Budget assumptions & Arithmetic • What should be Government’s response in the context of a 3D (3rd Deficit) Budget. • Attaining short-term economic stability • Medium term aspirations • Has the Budget met these objectives: An assessment of Budget measures • Concluding remarks

  3. The Present Economic Environment Source: Ministry of Finance- Review of the Economy 2010

  4. The Present Economic Environment Source: Ministry of Finance- Review of the Economy 2010

  5. The Present Economic Environment Source: Ministry of Finance- Review of the Economy 2010

  6. The Present Economic Environment

  7. Budget Assumptions & Arithmetic • GDP growth of 2 percent • Average inflation rate of 7 percent • Oil price of US$65 per barrel • Gas price of US$ 2.75 per mmbtu. • Total revenue $41.3 billion • of which: energy sector revenue = $15.2 billion non-energy sector revenue = $26.1 billion • Total Expenditure $49 billion • Fiscal Deficit $7.7 billion (5.48 %of GDP)

  8. What should be Government’s response! • Put in place measures that would stimulate the economy and instill confidence on the part of investors and citizens in general. • Give a clear picture of the medium term policy framework, in terms of its diversification and development policy. • Have some continuity of development projects and programmes that are of merit.

  9. Government’s Response: Short term stability Fiscal Incentives: Energy Tax regime • PPT(Deep water) 50% 35% • Mature & small marine fields SPT 20% • Investment tax credit of 20% on qualifying CAPEX. • Return to conventional PSCs with flexible bidding

  10. Government’s Response: Short term stability Fiscal Incentives: Increase in minimum wear and tear allowance to manufacturing companies from 10% to 25% Tax amnesty: Amnesty for tax penalities for late filing of returns and late payment of income , corporation and VAT, business levy, environmental levy and lands & buildings taxes.

  11. Government’s Response: Short term stability Income distribution: • Senior Citizens’ Pension $3000 per mth. • Increase in min. pension of retired public officers to $3000 per mth.

  12. Government’s Response: Medium term aspirations • Expand the energy sector • Realign the economy • Revitalize the Agriculture sector • Expand Tourism • Standardize our Environmental regulations

  13. Government’s Response: Medium term aspirations- Expanding Energy Sector • Signing of Unitization Agreement with Venezuela will allow access to approx. 2.7 tcf of gas to be monetized in the Loran-Manatee field. • Exploring the development of alternative energy sources such as wind and solar. • The export of energy advisory services. • Further diversification within the energy sector.

  14. Has the Budget met these objectives: An assessment of Budget measures • Some measures have been taken to bring stability and turn around government finances. The question are these enough? • The medium to long term measures needs to be distilled to allow a better analysis of their viability with respect to economic diversification and development

  15. Concluding remarks • Continuity of development programmes that are of merit. • Put measures in place to have a grip on inflation. • Getting back to a surplus budget position. • Minimum wage implications. • Implications of measures for employment • Public sector wage negotiations

More Related