Presentation Outline 1. Medium Term Fiscal projections 1. The 2011/12 and Medium Term Budget Policy 2. Medium Term Sectoral Allocation 3. Key Policy Issues 4. Conclusion �
Medium Term Fiscal Projections � The medium term fiscal projections have been derived from the macro- framework that have just been presented. � Domestic Revenues are projected to increase by an average of 0.3% of GDP in the medium term. Taxes on goods and services will contribute the big in the medium term. Taxes on goods and services will contribute the big share. � Taxes from International Trade will remain at about 1.1% over the medium term due to the shift of trade flows towards low tariff commodities. � Non-Tax Revenues are projected to remain constant at about 0.7% of GDP in the medium term although they will increase in nominal terms. � Budgetary Grants are fluctuating but with an overall declining trend as a share of GDP. � The Capital Grants decline sharply from 4.8% of GDP in 2010/11 to about 2.5% in the 2013/14. Global Fund numbers decline from 1.4% to 0.1% over the same period. As a result total grants decline by 1.5% of GDP. �
Medium Term Fiscal Projections �
Medium Term Fiscal Projections � The total expenditure and net lending declines by 4.5% of GDP from 2010/11 to 2013/14, an annual average decline of 1.5% of GDP. � Total recurrent costs are projected to decline marginally as a share of GDP from 14.9% in 2010/11 to 14.8% in 2013/14. Expenditures on goods and from 14.9% in 2010/11 to 14.8% in 2013/14. Expenditures on goods and services as well as on transfers will continue to increase. � The share of expenditures on domestically financed projects will decline as a share of GDP from 6.4% in 2010/11 to 5.6% in 2013/14. � Total expenditures on externally financed projects are projected to decline over the medium term by 3.6% with global fund resources declining by 1.3% over the same period. As a result total development expenditure declines. over the same period. As a result total development expenditure declines. � Net lending fluctuates but has an overall declining trend of about 0.1% of GDP from 0.6% in 2010/11 to 0.5% in 2013/14. � As a result, the overall fiscal deficit is projected to decline by 4.1% of GDP with significant reductions from net domestic financing. �
Medium Term Fiscal Projections �
Medium Term Budget Policy � The budget policy for 2011/12 and the medium term is anchored on progressively increasing the share of resources allocated to investment projects. � This is not only consistent with the policy aspiration of building a base for reducing reliance on foreign aid but also in tandem with the medium term fiscal projections. � Expenditure rationalization with incentives to re-allocate resources towards priority programmes will remain a key objective. � Consolidation of on-going programmes and projects and selectively � Consolidation of on-going programmes and projects and selectively allocating resources to new projects. � Scaling-up central government transfers to local governments to match resources to expenditure assignments while minimizing transaction costs to local governments. �
Medium Term Sectoral Allocation �
Medium Term Sectoral Allocation � The medium term sectoral allocation seek to further accelerate a pro- poor growth within a sustainable framework. Emphasis has been placed on: � Enhancing the productive capacities to unlock the potential in � Enhancing the productive capacities to unlock the potential in agriculture supply, agri-business and promotion of value addition in exports. � Scaling-up investments in physical infrastructure to create an enabling environment and act as a catalyst for rural transformation. � Sustaining the momentum in the human development and social � Sustaining the momentum in the human development and social sectors to progressively improve the quality of life of the population. This cluster registered a shortfall compared to EDPRS target due to enormous financing needs in the productive capacities and infrastructure sectors. � limiting further growth in good governance and sovereignty sectors to create savings for high priority areas . �
Resource Allocation - Infrastructure � ������������������������������������������������������������������� ���������������������������������������������������������������� ���������� �
Resource Allocation - Infrastructure � Resource allocation in the medium is gradually declining mainly due to limited information on projects over the three year time horizon. � The key projects and programmes : � The key projects and programmes : � Rehabilitation and extension of urban roads as well as rehabilitation of classified national road networks. � Finalization of detailed engineering design for Isaka-Kigali-Keza-Gitega- Musongati railway line. � Energy Roll-Out Programme to increase access to power by the rural population. population. � Nyabarongo hydro power station and construction of micro hydro power stations to augment power supply. � Geothermal resource and peat development project for electricity generation. ��
Resource Allocation - Infrastructure � Additional Capacity charge, fuel subsidies and import duties to stabilize power supply. � Implementation of Biogas Project to substitute for Charcoal and save the environment. environment. � Rehabilitation of Rwabuye fuel storage facility to increase capacity of fuel storage facilities and safeguard against fuel shortages and price instability. � Operationalization of optic fibre, deployment of E-Government and National Data Center � Construction of Kigali Convention Center and strengthening of Rwandair. � Eradication of grass thatched houses “Nyakatsi program” and promotion imidugudu. imidugudu. � Borders connectivity project to improve service delivery and doing business. � Implementation of development plans for cities and towns. � Implementation of IDP Model Projects in all provinces and Kigali city. ��
Resource Allocation – Productive Capacities � The big increase is mainly due to scaling up of investments in agricultural supply, agri-business, promotion of SMEs, post harvest handling and VUP Program. ��
Resource Allocation – Productive Capacities � The main focus for this sector is to enhance productive capacities. The key projects and programs are: � Irrigation program (incl LWH) to facilitate steady agricultural supply. � Scaling up priority crop intensification through increased supply and � Scaling up priority crop intensification through increased supply and distribution of fertilizers and seedlings. � Replenishment of National Strategic Food Reserve. � Agricultural Mechanization Programme. � Gishwati Land and Water Management � One Cow One Family and One Cup of Milk per Child Projects. � One Cow One Family and One Cup of Milk per Child Projects. � Support to small stock development. � Kigali wholesale market for agriculture product. � Improving coffee production, productivity and quality. ��
Resource Allocation – Productive Capacities � Promotion of business services and cooperatives including the SACCO programme. � Construction of one pilot provincial industrial park. � Implementation of the export promotion programme. � Systematic Land Registration Project. � Protecting the banks and catchment area of Nyabarongo. � Protecting the banks and catchment area of Nyabarongo. � Support to the Rwanda Bureau of Standards to set up quality testing laboratories and acquisition of equipment. ��
Resource Allocation – HD + Social Sectors ��
Resource Allocation – HD + Social Sectors � The key programs and projects financed under this cluster are: � Schools construction, teachers’ salaries, capitation grant, schools feeding and text books in line with the 9 YBE programme. � TVET and Integrated Polytechnic Regional Centres to promote vocational training and narrow the skills gap and employment challenges in the domestic market. � Support to UMWALIMU SACCO (Teachers’ cooperative) to improve the welfare of teachers through loan schemes. � Support to finance higher education through cost sharing and development of infrastructure and laboratory equipments. � Implementation of One laptop per child program in primary schools and enhancement of ICT in secondary schools ��
Resource Allocation – HD + Social Sectors � Implementation of the new health insurance policy through providing contribution to indigents to achieve full coverage of health insurance for the population. � Implementation of performance based financing for the health � Implementation of performance based financing for the health personnel and provision of salaries for health workers. � Rehabilitation and expansion of King Faisal Hospital. � Completion of Kinihira and Ntongwe District Hospitals. � Accreditation of reference hospitals to improve quality of services and � Accreditation of reference hospitals to improve quality of services and standards. � Procuring drugs and vaccines for hospitals and health centers and controlling of infectious diseases. � Acquisition of Health Equipment and District Ambulances. ��
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