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Standard Bank Budget Presentation Vetumbuavi Mungunda Naufiku - PowerPoint PPT Presentation

Standard Bank Budget Presentation Vetumbuavi Mungunda Naufiku Hamunime March 2017 Construction Slowdown Reduced Government Spending MACROECONOMIC OVERVIEW ECONOMIC GROWTH GDP by sector at Current Prices (N$ millions) Real GDP Growth


  1. Standard Bank Budget Presentation Vetumbuavi Mungunda Naufiku Hamunime March 2017

  2. Construction Slowdown Reduced Government Spending

  3. MACROECONOMIC OVERVIEW

  4. ECONOMIC GROWTH GDP by sector at Current Prices (N$ millions) Real GDP Growth (%) Health Education 7.00 Public Administration & Defence 6.4 Real Estate & Business Services 6.00 6 5.7 Financial Intermediation 5.3 5.1 5.1 5.00 Transport & Communication Hotel & Restaurants 4.00 Wholesale & Retail Trade 3.00 Construction 2.60 2.5 Electricity & Water 2.00 Manufacturing 1.00 1 Mining & Quarrying 0.3 Fishing & Fish Processing 0.00 Agriculture & Forestry 0 5000 10000 15000 20000 2014 2015 2016

  5. ECONOMIC GROWTH VS. PEERS Regional GDP Growth (%) GDP per capita 2015 (USD) 7000 6360 12 5724 6000 10 4674 5000 4000 8 3000 6 2000 1377 4 1000 2 0 Kenya Botswana South Namibia Africa 0 2009 2010 2011 2012 2013 2014 2015 2016 -2 Nominal GDP 2015 (USD bn) -4 350 315 300 -6 250 -8 200 -10 Namibia Bostwana Kenya South Africa 150 100 63 50 14 11 0 Kenya Botswana South Namibia Africa

  6. ECONOMIC GROWTH VS. PEERS Real GDP by sector 2015 (%) Public Administration and Defence Financial Intermediation & Real Estate Transport & Communication Wholesale & Retail Trade, Catering & Accomodation Construction Electricity & Water Manufacturing Mining & Quarrying Agriculture, Forestry & Fishing 0 5 10 15 20 25 30 35 Namibia South Africa Botswana Kenya

  7. ECONOMIC GROWTH VS. PEERS Regional Debt to GDP (%) Foreign Reserves (NAD million) 30000 60 25000 20000 50 15000 10000 40 5000 0 2010 2011 2012 2013 2014 2015 2016 30 Total Government Debt (NAD million) 20 70,000 10 60,000 50,000 0 40,000 2012 2013 2014 2015 2016 30,000 Namibia Bostwana Kenya South Africa 20,000 10,000 0 2012 2013 2014 2015 2016 Net Debt

  8. GOVERNMENT FINANCES

  9. FISCAL OVERVIEW: REVENUE Revenue (NAD million) Main Revenue Categories (NAD bn) Income Tax on Individuals 60000 50000 Company Taxes 40000 30000 Domestic Taxes on Goods & Services 20000 10000 SACU Receipts 0 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 0 5 10 15 20 Composition of Government Revenue (2015/16) 2012/13 2013/14 2014/15 2015/16 2016/17 Non-Tax Year-on-Year Change (%) Revenue 35 6% Income Tax 30 On Individuals 25 21% 20 SACU 15 Company Tax Receipts 10 15% 33% 5 Domestic Taxes on 0 Goods & 2012 2013 2014 2015 2016 2017 -5 Services Total Tax Revenue 23%

  10. FISCAL OVERVIEW: REVENUE VS. PEERS Revenue as % of GDP 45 40 35 30 25 20 15 10 5 0 Namibia Botswana South Africa Kenya 2013 2014 2015 2016 Composition of Revenue (2015/16) Other Non-Tax Other 1% Revenue Taxes Namibia Botswana (incl. 1% Non-Tax Mineral Revenue Income Royalties) (incl. Income Taxes 6% Mineral Taxes 27% SACU Royalties) 37% Receipts 32% 33% Total Revenue & Total Revenue & Domestic Grants Grants Domestic Taxes on Taxes on SACU Goods & N$52.22 Bn N$64.79 Bn Goods & Receipts Services Services 30% 23% 10%

  11. FISCAL OVERVIEW: EXPENDITURE Expenditure (NAD millions) 70000 Revenue & Expenditure Year-on-Year Change (%) 60000 50000 30 40000 25 30000 20 20000 15 10000 10 0 5 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 0 2013/14 2014/15 2015/16 2016/17 2017/18 Composition of Government Expenditure (2016/17) -5 -10 Capital Acquisition Transfers of Capital -15 2% Assets 10% -20 Personnel Expenditure Subsidies & 43% Other Government Revenue Government Expenditure Current Transfers 30% Goods & Other Services 15%

  12. FISCAL OVERVIEW: EXPENDITURE Expenditure as % of GDP 50 40 30 20 10 0 Namibia Botswana South Africa Kenya 2013 2014 2015 2016 Total Expenditure (NAD bn) 80 70 60 50 40 30 20 10 0 2013 2014 2015 2016 Namibia Bostwana

  13. FISCAL OVERVIEW: BUDGET ALLOCATIONS Main Ministerial Allocations (% of Expenditure) % Botswana 35 Poverty Eradication & Social Welfare 30 25 Higher Education 20 15 10 Transport 5 0 Agriculture, Water & Forestry Defence Education Health 2015 2016 Urban & Regional Development % Health and Social Services Kenya 20 Education 15 Finance 10 5 Defence 0 Safety & Security Defence Education Health 2013 2014 0 5 10 15 20 25 2014/15 2015/16 2016/17

  14. FISCAL OVERVIEW: WAGE BILL Personnel Expenditure (NAD bn) 20 20.5 21 21.5 22 22.5 23 23.5 24 24.5 25 2014/15 2015/16 2016/17 Public Servants (2015/16) Namibia 40000 35000 30000 25000 20000 15000 Botswana 10000 5000 0 Defence Education Health & Agriculture, Works Force, Police & Social Water & Correctional Services Forestry Services

  15. OPERATIONAL VS. DEVELOPMENT BUDGET Operational & Development Expenditure (NAD million) 60000 50000 40000 30000 20000 10000 0 2012/13 2013/14 2014/15 2015/16 2016/17 Operational Development 2016/17 Mid-Year Suspensions to the Operational Budget 2016/17 Mid-Year Suspensions to the Development (NAD million) Budget (NAD million) 2500 2500 2000 2000 1500 1500 1000 1000 500 500 0 0 Goods & Other Acquisition of Capital Transfers Personnel Goods & Other Subsidies & Acquisition of Statutory Services Capital Assets Expenditure Services Transfers Capital Assets Expenditure Total Operational Budget cut by N$2.82 Billion Total Development Budget was cut by N$2.7 Billion

  16. Necessary Pains for A Secure Future

  17. 2017/18 BUDGET Foundations for A Secure Budget 2017/2018 Yes/ No Future Continue with Mid-Term Reforms: freezes in Reduce Wage Bill  civil service, Performance Contracts, Revise PSEMAS Policy Certainty (NEEEF, PPP) PPP legislation introduced in parliament. ? NEEEF undergoing revisions after 2016 public consultations. Reprioritize Expenditure N$9 billion allocated to Development ? Expenditure, increase from N$ 6.3 allocated in previous financial year Essential Infrastructure Spending Development Infrastructure prioritized ? includes: Railway Rehabilitation, Expansion of (Water, Energy, Social Housing) Walvis Bay Port, Mass Land Servicing & Housing, and Water & Storage Infrastructure  Public Management Reforms SOEs Reform & Divestiture Budget Deficit projected to decrease from Budget Deficit & Debt 6.3% (2016/17) to 3.5%  Debt to GDP projected to remain consistent at 42% Measures taken to stimulate ? ? increased industrial & economic activity (agriculture, tourism, etc.)

  18. THANK YOU

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