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Sunday, March 3, 2024

Unmasking the masked man – The truth about 2024 estimates

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By Nuha Ceesay,
Leeds, United Kingdom

Please allow me space in your widely read newspaper to provide analysis on the Gambia Government’s estimates of revenue and expenditure 2024. This analysis reflects how deceptive our finance minister has been throughout the process.

I will start by looking at the minister’s statement in parliament where he said that the Ministry of Agriculture’s budget increased by 17%. This is relating to the Departmental Recurrent & Development Budget – GLF on page 24 of the estimates of revenue and expenditure 2024. I will agree with this assertion to some extent as the “Recurrent and Development budget for this ministry increased from D723m in 2023 to D845m in 2024 (17%). However, what the minister failed to tell lawmakers was that in actual fact, the Ministry of Agriculture’s budget will decrease by 32% (D1.2bn) in 2024. My figures are justified by the minister’s Departmental Recurrent & Development Budget – Loans, Grants and GLF on page 27 of the estimates, where Agriculture’s budget decreased from D3,751,620,000 to D2,563,973,000 mainly driven by reduction in development expenditure from D3,117,409,000 in 2023 to D1,781,226,000 in 2024.

Similarly, Tourism’s budget decreased from D387m in 2023 to D251m in 2024 representing 35% reduction in total expenditure of that ministry, again driven mainly by development expenditure. A closer look at the budget for the Ministry of Trade also shows that the total expenditure will decrease in 2024 by 69% from D378m in 2023 to just D117m in 2024. I have noted similar trends in the budget for the ministry of Environment reducing from D1.4bn in 2023 to a mere D628m representing a reduction of 56%. I do not think I am going nuts because the figures I am quoting here are definitely from the Gambia Government’s estimates of revenue and expenditure 2024, page 27 available on the Ministry of Finance’s website. What is intriguing is that the minister increased the budget for his ministry from D1,934,096,000 in 2023 to D2,156,006,000 representing an increase of 11%. It appears that the productive sectors of the economy are the victims of budget cut with non-productive sectors having a bumper harvest of budget increase.

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Furthermore, the minister decided to hoodwink the lawmakers by indicating that total expenditure as a percentage of nominal GDP in 2024 is 24% compared to 30% in 2023. He stated that nominal GDP in 2023 was D131bn increasing to D174bn in 2024 (page 1 of the estimates file). As you can see, the minister is forecasting an increase of 34% in nominal GDP between 2023 and 2024. What makes me feel sorry for the Gambia is that there are so called intellectuals who believed that this budget is great, but actually, it is nothing other than bad news for the Gambia. Can the minister please justify how the nominal GDP will increase by 34% year on year in 2024 in the face of the below from the minister’s budget speech:

1.         Real GDP to grow to 5.6% in 2023 compared to 4.9% in 2022 against 5.3% in 2021

2.         Agriculture to grow to 8.3% in 2023 from 3.6% in 2022

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3.         Industry including construction is expected to grow to 7.4% in 2023 and this is despite strong performance in electricity and construction subsectors.

4.         Total Expenditure and net lending in 2023 as at end of September was 22.9bn from 20.5bn in 2022; a significant increase in government expenditure.

5.         Revenue loss due to exemption increased to D3.09 billion in nine months to September 2023 from D2.2 billion in the same period in 2022. This is largely due to duty waivers granted by government for the implementation of on-going road works, agriculture, energy and education projects

6.         Annual growth in broad money decelerated to 5.6 percent at end-September 2023, from the 9.9 percent growth observed in the corresponding period the year before

7.         12 months to September 2023 saw volume of transactions measured by the aggregate of purchases and sales of foreign currency decreased to US$2.1 billion from US$2.5 billion in the same period in 2022. Purchases of foreign currency decreased by 15.3 percent, to US$1.0 billion. Similarly, sales of foreign currency declined by 16.1 percent, to US$1.1 billion in the same period

8.         Figures show that the Current Account deficit widened to US$209.0 million (10.1percent of GDP) in the nine months ending September 2023, from US$74.7 million (3.8 percent of GDP) in the corresponding period of 2022, due to higher imports bills, despite significant growth in total exports

9.         The Goods Account registered a deficit of US$702.1 million (34.0 percent of GDP) in the review period, higher than US$444.9 million (22.4 percent of GDP) recorded in the corresponding period in 2022. The widening of the deficit in the Goods Account is because of the increase in the value of imports (FOB) from US$489.0 million in the nine months of 2022 to US$702.1 million in the nine months of 2023. The main merchandise imports include electricity, vegetables, rice and cereals, fuel, and oil, and the main import partners in the review period were Senegal, India, and China.

10.       The Secondary Income Account (current transfers) declined marginally by 0.9 percent to a net inflow of US$372.7 million in the nine months 2023, from a net inflow of US$376.1 million in the corresponding period of 2022.

This and many more, and I can go on and on endlessly reflecting how deceptive it is for the minister to face the People’s Assembly and blag his way out without shame.

I am disappointed in the National Assembly and their team of “Subject Matter Experts” who cannot see through the flaws in the budget but continue to thank the minister for a job well done. It is shameful and what is more worrying is that the Gambia Institute of Chartered Accountants (GICA) is mute over these professional deceptions manifested in the estimates of revenue and expenditure 2024.

One thing is certain though is that the finance minister is a very good financial analyst and I will give him that. However, he is not using the great analytical skills he has for the good of our peasant farmers and the 53% (World Bank, 2022) poor population of the country.

I want to take this opportunity to openly invite the finance minister to a discussion on the estimates on a program I run on Mengbekering and Home Digital FM called “Breaking It Down” every Sunday.

I cry for the Gambia and the poor people cry along but sadly, our cries are not heeded to. We will continue to cry until we pen another piece again.

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