KINGSTON, Jamaica, Thursday April 4, 2013 - Ahead of Thursday’s presentation of the 2013/2013 Budget Debate, a local financial analyst is warning of major challenges on the horizon .
With the Budget being tabled against the background of a not yet signed deal with the International Monetary Fund (IMF), financial analyst, Dennis Chung, believes it will be difficult for the Government to meet its revenue target.
“My own feeling is that country might have gotten to a point where you getting declining returns from new tax measures. I think we are going to see a budget presented maybe about five per cent more in absolute terms.
"But going into September or maybe even before that, unless we start seeing some growth coming into the economy, we could see the budget having a little challenge, because it is really at best a stretch target that they are looking at,” Chung said.
On Wednesday the Jamaican dollar lost 8¢ against the United States dollar, trading for J$99.16 to US$1.
Chung said the government must move to address the devaluation which will cause inflation and increase the country’s debt position.
He also said that the delay in finalising a deal with the IMF will lead to more speculation in the market and possibly more job losses.
Meanwhile, Dr. Adrian Stokes, another financial analyst is predicting a marginal increase in Government expenditure over the next 12 months.
“Well for the above the line expenditure….I’m expecting a slight increase over last year not accounting for debt amortisation or anything, just dealing with programmes, wages and capital expenditure, I’m expecting a slight increase over last year,” he said.
The Estimates of Expenditure will be tabled in Parliament on Thursday afternoon by Finance Minister, Dr. Peter Phillips.
Phillips is expected to state how the Budget will be financed when he makes his contribution to the debate on April 18.
When the Estimates for 2012/13 were tabled on May 10 last year, it was projected that the Government would spend J$612.4 billion (One Jamaica dollar = US$0.01 cents).However, when the First Supplementary Estimates were presented on February 5, the figure was revised to J$602 billion. (CMC) Click here to receive free news bulletins via email from Caribbean360. (View sample)