By Tabora Bojang
Finance Minister Seedy Keita has said The Gambia is edging closer to debt distress and that there have been no substantial budget support from development partners.
Addressing concerns from lawmakers on the limited budget allocations for sectors like health, Minister Keita said: “If you have no borrowing limit, you can borrow and spend but unfortunately we are almost at near debt distress. That is why we are spending 29 percent of our [2025] budget amounting D11 billion on debt servicing. This is not unique to The Gambia. Other countries in Africa like Angola are spending 58 percent of their budget on debt servicing. That is why the priority of this budget is deficit reduction. D11 billion is more than the budget of five ministries combined. The only way to avoid that is to tackle the debt stock and increase the tax base. The debt servicing is high because we have passed the debt servicing deferral period. Now we are paying back the principal on amortisation basis of the international obligations.
Minister Keita continued: “Some of the advice that we took in the past is catching up with us now. When we deferred the servicing of the obligation of the principal element, the exchange rate was lower but whatever savings we have made has been overtaken by the depreciation of the exchange rate and as a developing country our exchange rate is not just determined by our own balance of payment and other macro fiscal policies but it is determined by the actions of the Federal Reserve [Bank] and the US Government. If the dollar strengthens globally no matter how good your economy is as a developing country it will depreciate against the dollar.”
Unaccountable revenues at Ministry of Health
Minister Keita also told lawmakers that one of the areas that needed to be worked on is the Ministry of Health’s budget. “We observe that the Ministry of Health has subvented entities that are generating revenue. And those revenues are not reported to us. We never had any information on their collection to the central pot,” he contended.
He said the essence of government giving subvention to institutions to top up on their earnings is to help them maintain operation and service delivery. “If you are generating revenue and you need subvention, I need to know your expenditure cost, budget, how much are you collecting and how much is the difference. It is that difference that the central government should close but that has not been happening.”
The minister said improvements have been made since the Accountant General’s Department began collecting revenue from some health institutions. “For the EFSTH, we brought in a bank and in just one month revenues moved from D1.2 million to D4.6 million. So we need to see those entities that are generating revenue. If you are generating revenue you need to present your budget to us but that has not been happening. We don’t know what they are collecting.” Keita disclosed.
