(2020-03) Budget framework letter for fiscal year 2019-2020
Summary — A memorandum from the Prime Minister to all public administration spending authorities (ordonnateurs), signed 25 March 2020, sets the fiscal priorities and practical directives for finalizing the FY2019-2020 budget. It reviews an alarming 2018-2019 macro-fiscal record (GDP down 1.2%, inflation at 20.1%, gourde depreciation) and the difficult start to FY2019-2020, then lays out six priority objectives and resource/expenditure guidelines for the remaining six months of the fiscal year.
Key Findings
- GDP contracted 1.2% in 2018-2019 versus a +2.1% post-earthquake average, and is projected at -2.7% for FY2019-2020.
- Inflation reached 20.1% in September 2019, in double digits since 2015.
- The gourde depreciated from an average of 65.4/USD (2017-2018) to 84.1/USD (2018-2019) to 92.3/USD in the first five months of FY2019-2020.
- The non-financial public sector deficit rose to 3.8% of GDP in 2018-2019 from 2.9% the prior year, while central bank monetary financing hit 21.1 billion gourdes by 29 February 2020, 11.1 billion above the agreed ceiling.
- Domestic revenue collection through February 2020 (33.7 billion gourdes) fell short of the 37.1 billion gourde target by 3.4 billion gourdes, with a full-year domestic revenue target of 84.6 billion gourdes.
- Six budget priorities are set for the remaining six months: internal security, health system/COVID-19 response, social programs, agriculture/textile exports, fiscal rebalancing, and rapid-result priority projects.
Full Description
Signed by Prime Minister Joseph Jouthe on 25 March 2020 and addressed to all spending authorities and heads of independent institutions, this budget-framework circular ('lettre de cadrage') sets the terms for finalizing Haiti's FY2019-2020 budget with six months of the fiscal year remaining. It opens with a detailed diagnosis of the deteriorating macro-fiscal situation over 2018-2019 and the first five months of 2019-2020: GDP contracted 1.2% (against a post-earthquake average of +2.1%), inflation reached 20.1% in September 2019, the tax-revenue-to-GDP ratio fell to 10.8% (from 13.7% in 2015-2016), foreign direct investment halved to USD 75 million, and the gourde depreciated from an average of 65.4 to the dollar in 2017-2018 to 92.3 in the first five months of 2019-2020. The non-financial public sector deficit widened to 3.8% of GDP, central bank monetary financing exceeded agreed ceilings by 11.1 billion gourdes as of 29 February 2020, and domestic revenue collection through February 2020 (33.7 billion gourdes) fell 3.4 billion gourdes short of projections. The letter anticipates a 2.7% GDP contraction for FY2019-2020, compounded by the COVID-19 pandemic (state of health emergency declared 19 March 2020), and instructs ministries to concentrate the remaining budget on six priorities: internal security and rule of law, strengthening the health system for epidemiological surveillance and COVID-19 response, structuring social programs, support to agriculture and textile exports, rebalancing public accounts to contain monetary financing, and rapid-result priority projects. It also sets practical requirements for budget submissions (needs justification, performance indicators, expected results, quarterly execution plans).
Notes
Document is a Primature (Prime Minister's office) circular addressed to spending authorities on preparation of the MEF-led FY2019-2020 budget; signed by PM Joseph Jouthe on 25 March 2020, which is used as the publication date. Organization coded as MEF per batch grouping, though the letterhead and signature are from the Office of the Prime Minister.