Several economic and political events have had significant impacts on implementation of the budget for the financial year 2014-2015 among the major :

- The sharp drop in oil prices on the international market causing the decline in resources from the PetroCaribe Agreement;

- The monetary tightening by the Central Bank (BRH);

- Episodes of political tensions that led to the change of Government;

- The organization of elections at various levels of exercise of political power.

In order to ensure the stability of Public Finance, an amending budget consistent with a budget deficit reduction policy has been adopted. A new program was agreed with the IMF on the reforms and policies to strengthen public finances and create the conditions for economic growth and reduce the fragility of the financial situation of the country reminds the Ministry of Economy and Finance.

Overall situation of public finance, fiscal year 2014-2015 :

Preliminary data for the year confirm that fiscal consolidation dynamics (deficit reduction) is engaged but at the cost of a reduction in investment spending because the the transfers to the Electricity of Haiti (EDH) (8.0 billion gourdes including Treasury and the PetroCaribe Fund) remain on the rise compared to the previous year.

A monitoring of expenditures and a significant revenue performance (47.1 billion gourdes in 2013-2014 to 56.8 billion in 2014-2015) allowed the public finances to end positively in engagement basis (2.1 billion gourdes), unlike the previous year (-5.4 billion). By cons, cash basis was in deficit (-1.0 billion gourdes) against (-7.8 billion) for the previous year. The balance in cash basis would be affected by expenses incurred in the previous year (4.2 billion gourdes), letters of credit and other unbudgeted expenditure in favor of the EDH (6.4 billion Gourdes).

The cash deficit is covered at the level of financial operations results that include :

a) A negative net balance of external funding, -626 million gourdes against 3.5 billion the previous year. Actually donations (budget support) fell from 4.2 to 1.4 billion gourdes, while amortization of external debt (were multiplied by 3).

b) A positive net domestic financing is in reduction of 62% from 4.2 billion to 1.6 billion gourdes including a net BRH financing of 8.1 billion gourdes including G. 4.4 billion by reducing or using deposits of the State account at the BRH.

The use of savings of banks has also decreased and net flows (-4.1 billion Gourdes) are negative, including amortization for 15.1 billion against the issuance of bonds of 11 billion gourdes. BRH funding would be at least 6.3 billion gourdes, or below the level agreed in the program agreed with the IMF (7.9 billions) if budget support from the European Union of 1.8 billion gourdes had been finalized before 30 September.

Download the detailed report Financial year 2014-2015 : https://www.haitilibre.com/docs/Synthese-SFP-2014-2015.pdf

HL/ HaitiLibre