A Budget Situated within Context

#Politique

The 2019 draft Finance bill tabled in parliament Friday, 16, Nov. 2018 tells of a FCFA 161 billion increase in absolute terms and 3.4 per cent in relative terms.

The socio-economic and political circumstances within which a country finds itself at a particular moment is usually the determining force for preparing and above all executing its annual budget.

The draft bill of the 2019 State Budget otherwise known as the Finance Law tabled before the Lower House of parliament, last Friday, 16 November, 2018, according to the explanatory note, is an attempted translation of the zeal to boost the country's strong economic growth within an international environment characterized by relative increase in oil prices and the execution of the triennial economic and financial programme concluded on 26 June, 2017 with the International Monetary Fund (IMF).

The budget is equally prepared having in mind the prevailing insecurity situation in the Far North, North-West and South-West Regions and the implementation of the country's new exigencies notably the decentralization process. The draft budget, balanced in revenue and expenditure at FCFA 4,850.5 billion compared to FCFA 4,689.5 billion the previous year, showing an increase of FCFA 161 billion or 3.4 percent, has been proposed in honour of government's socioeconomic and political commitment.

In effect, the 2019 financial year will witness a medley of challenges including the organization of legislative and municipal elections and the hosting of the Africa Cup of Nations football tournament. The announced recruitment of 2000 Phd and doctorate holders, 1,000 of which will be absorbed in 2019, will certainly require additional resources. Many other projects, details of which will soon be presented before law makers by the Prime Minister, Head of Government have equally been earmarked.

The bill is based on the assumptions of a GDP growth rate of 4.4 percent, a barrel of oil price of 63.5 dollars and a parity of CFCA 555.1 for 1 US dollar. In a bid to measure up to the commitment announced by government, many new customs, tax and financial measures have been proposed, all aimed at stepping up domestic revenue collection. This include , notably, increasing the tax pressure rate from 13.1 per cent of GDP in 2018 to 13.2 per cent in 2019, reducing public expenditure and keeping the debt rate under control. In other words, the tax base will be broaden and expenditure reduced.

Other measures proposed in the bill include, improving the business climate and reinforcing guarantees to taxpayers. Some of the innovations underscored on the bill include, an increase in the threshold of non-concessional loans from FCFA 436 billion to FCFA 500 billion. The breakdown of the revenue to be raised is as follows: Non-oil revenue, FCFA 3,079.5 billion, oil and gas revenue, FCFA 450 billion, project loans, FCFA 588 billion, government security issues, FCFA 260 billion, bank financing, FCFA 65 billion, budget support from development partners, FCFA 329 billion and grants, FCFA 79 billion.

Expenditure on its part is shared as follows: recurrent, FCFA 2,465.5 billion, capital expenditure, FCFA 1,327.6 billion, and public debt servicing, FCFA 1,057.4 billion. Worthy of note is the significant increase in the budget share of the newly created ministry in charge of Decentralization and Local Development from FCFA 11.477 billion to FCFA 45.756 billion, an indication government wants to fast-track the decentralization process within the financial year.

Other areas that have witnessed no ticeable increase are: the General Delegation of National Security from FCFA 83.947 billion to FCFA 120.055 billion, secondary education, from FCFA 365.212 billion to FCFA 393.079 billion, water resources and energy from FCFA 145.487 billion to FCFA 202.672 billion, public works, from FCFA 326.269 billion to FCFA 361.344 billion and public health from FCFA 175.240 billion to FCFA 207.943 billion.