Prime Minister's Budget Framework Letter for FY 2021-2022

This is a formal memorandum, dated 4 April 2022 in Port-au-Prince and signed by Prime Minister Dr Ariel Henry, addressed to all spending officers (ordonnateurs) of state institutions as the budget framework letter (lettre de cadrage) for the FY2021-2022 draft budget. It opens by recalling that FY2020-2021 was disrupted by a compounding sequence of shocks (a COVID-19 resurgence from May 2021, the assassination of the President in early July 2021 and the ensuing institutional vacuum, the 14 August 2021 magnitude-7.2 earthquake striking the Sud, Nippes and Grand'Anse departments with losses and damages equivalent to 10.9% of 2020 GDP, tropical depression Grace two days later, and rising gang violence and kidnappings). It reports FY2020-2021 outturns (real GDP growth -1.8%, inflation 13%, tax pressure 5.7%, BRH financing of 42.9 billion gourdes including a 50% allocation of the IMF's SDR allocation), and notes that because the country could not adopt a budget on time, the first six months of FY2021-2022 were run under a renewed rectified budget.

The letter then sets out the government's fiscal priorities for the remaining six months of FY2021-2022: financing the Plan de Relevement Integre de la Peninsule Sud (PRIPS) with 10 billion gourdes of Treasury investment spread over four years; allocating 3 billion gourdes to the Politique Nationale de Protection et de Promotion Sociales (PNPPS); and financing agricultural campaigns to mitigate anticipated inflation from the Russia-Ukraine war's impact on global commodity prices. It cites a newly negotiated IMF Staff-Monitored Program as a catalyst for other technical and financial partners, and lists reform commitments across six axes (macro-financial equilibria, fiscal resource mobilization including a planned phase-out of fuel subsidies and a first Code Fiscal Haitien, governance and security including publication of the Cour des Comptes' COVID-19 spending audit, social protection, COVID-19 vaccination, and expenditure rationalization via a public-service voluntary-retirement program with limited recruitment at a 1-for-2 replacement ratio). It closes with the FY2021-2022 budget's macro-fiscal targets: real GDP growth of 0.3%, tax pressure of 6.4% (up from 5.7%), inflation revised to 27.3% year-on-year (from 13% in 2020-2021), and BRH financing of 40.3 billion gourdes (versus a figure cited elsewhere in the same letter as 49.2 billion gourdes for 2020-2021, an internal inconsistency with the 42.9 billion gourdes figure given earlier in the text).