Public Investissements: limited in 2010, ambitious in 2011

For a denial of international recognition for the putsch originated regime, the rest of the country was deprived again from foreign financial support in 2010. But the HAT finance ministry outlined the “success of a policy based on austerity, good governance and transparency”, in spite of a drop in tax returns. The ship was kept afloat by not completely legal financial sources, namely the 100 millions of Dollars high “bribe” from the chinese corporation WISCO in return of the right to exploit iron from Soalala.

Chinese dirty money even compelled the HAT to patch up an amended year 2010´s finance law. The non tax related returns significantly rose to 270.6 billions against the basically planed 55.2 billions of ariary. Tax returns dropped from 2117.4 billions to 1904.7 billions of Ariary, a 211.7 billions high difference. In the end, the maths granted some 2175.3 billions of Ariary to the state with a 10.5% high burden of taxation

Public expenses

During the year 2010, public expenses have mainly been financed by the state. THe lack of foreign support enforced a 558.8 billions of Ariary high reduction of expectations. Only 2886.7 billions were in the end available. Every ministry and institution had to financially tighten the belt.

Exclusively the departments in charge of defense, home security, the High Authority of Transition and the transitional High Council even had a rise in their share. The good news: the spending deficit dropped from 3.2% to 1.9% of the gross domestic product (GDP)

In 2011, investments are expected to rise by 32% compared to what was basically planned in the year 2010´samended finance law, from 948.6 billions to 1251.9 billions of Ariary. THe couple of the Public Investment Program (PIP) main directions are focusing on the construction and restoration of facilities directly linked to social development. 60.7% of the money is stemming from foreign sources.

37.7% of the PIP will address infrastructure, mainly the development of electrical and energy related facilities. 16.4% of the PIP will support production in general, improvement for agriculture, and the protection of the environment.

The purely social field will recieve 32.1% of the PIP, healthcare and education on top of priorities. The latest 19.8% are going to be dedicated to the administration, as well as to the reinforcement of security