(2013-03) Budget framing letter for FY2013-2014
Summary — Memorandum from the Prime Minister to all state spending authorities (ordonnateurs) setting the macroeconomic and expenditure ceilings for preparing the FY2013-2014 budget. It reviews disappointing post-earthquake growth outcomes and fixes growth, inflation, tax-pressure and no-monetary-financing targets for the coming budget.
Key Findings
- GDP growth reached only 5.6% in 2010-2011 versus post-earthquake expectations above 10%, and 2.8% in 2011-2012.
- Growth forecast for 2012-2013 revised down to 3.4%, half the initial projection.
- February 2013 fiscal revenue averaged 3.5 billion gourdes/month against a budgeted 4.3 billion, forcing operating spending capped at 15.8 billion gourdes (3.2 billion/month average).
- FY2013-2014 targets: growth ~4.5%, inflation ceiling 5.6%, tax pressure ratio >=13% (15% within 3 years), stable exchange rate, no monetary financing.
- Budget proposals due to MEF and MPCE by 15 April 2013.
Full Description
Signed by Prime Minister Laurent Salvador Lamothe (Primature, ref. PM/LSL/mo-cbs/496), this memorandum is the official budget framing letter (lettre de cadrage) sent to all ordonnateurs of state institutions to guide preparation of the FY2013-2014 draft budget law. It reviews recent growth performance: GDP rebound of only 5.6% in 2010-2011 despite post-earthquake optimism above 10%, just 2.8% in 2011-2012, and a downward-revised 3.4% expected for the current 2012-2013 exercise (half the initial forecast), attributed to limited absorptive capacity, recurrent shocks (cyclones Sandy and Isaac, prolonged drought), fragile productive structures favoring imports, and delayed reform implementation. It notes early-2013 indicators showing declining inflation alongside marked gourde depreciation and weak fiscal revenue (monthly average of 3.5 billion gourdes against a budgeted 4.3 billion), which forced operating expenditure to be capped at 15.8 billion gourdes (monthly average 3.2 billion) to protect investment spending.
For the 2013-2014 budget, the government sets five macroeconomic objectives: economic growth around 4.5% rising progressively thereafter; year-on-year inflation not exceeding 5.6%; a tax-pressure ratio reaching or exceeding 13% (targeting 15% within three years); a relatively stable exchange rate given pressure on foreign reserves; and no recourse to monetary financing. The letter frames 2013-2016 as a pivotal period for institutional consolidation under the Plan Strategique de Developpement d'Haiti (PSDH) and the government's four "refondations" (institutional, economic, social, territorial), lists seven priority objectives (growth and jobs, free education and basic health access, poverty reduction, rule of law, public financial management modernization, environmental protection and disaster resilience, regional economic diversification), and issues twelve detailed directives to ordonnateurs on preparing operating and investment expenditure proposals, staffing ceilings, arrears prohibition, and non-fiscal revenue forecasts, with a submission deadline of 15 April 2013 to MEF and the Ministere de la Planification et de la Cooperation Externe (MPCE).
Notes
Cover memo is undated (only the reference number PM/LSL/mo-cbs/496 and a 15 April 2013 submission deadline appear); publication month prefix (2013-03) is inferred from the deadline and the February 2013 data cited in the text, not printed on the document. Document is issued by the Primature (Prime Minister's office) rather than MEF directly, though it directs the MEF-led budget cadrage process; organization tagged MEF per batch convention.