Mar 2015 Financial News

Govt records $328m budget surplus

Mar 05, 2015

In the last three months of 2014, Government recorded a budget surplus of more than $328 million.

This was a marked improvement from the $1 billion deficit Government was expected to realise after oil prices plummeted on international markets.

A statement from the Ministry of Finance on Central Government fiscal operations said yesterday: “Even as economies around the globe come to grips with the impacts — both negative and positive — of the dramatic downward slide in oil prices, the Trinidad and Tobago economy continues to adjust to the new realities. Our macroeconomic fundamentals remain strong and allow an adjustment to the new level of energy prices prevailing globally.”

The ministry said data at the end of December 2014 showed:

Official reserves were US$11.3 billion;
Import cover remains high at approximately 14 months;
The Heritage and Stabilisation Fund currently stands at US$5.6 billion;
Unemployment remains historically low at 3.6 per cent;
Inflation remains in single digits at approximately nine per cent;
The country’s external debt service ratio remains manageable at approximately 8.6 per cent; and
Our debt remains moderate with Net Debt to GDP measuring approximately 43 per cent;

Data on Government’s revenues and expenditure for the fiscal period October to December 2014 showed that preliminary revenue figures were overall lower than budget estimates by approximately 5.5 per cent.
They were projected at $13.4 billion but actual revenues stood at $12.7 billion.

“This was primarily due to lower than anticipated receipts from taxes on Goods and Services and International Trade, a drop of 15.5 per cent and 12.1 per cent respectively. While revenue derived from Other Taxes (11.5 per cent) and Non-Tax Revenue were higher than anticipated by 11.5 per cent and two per cent respectively.”
Preliminary expenditure figures over the same period fell below budget projections by 14.3 per cent from $12.4 billion (budgeted) to $12.4 billion (actual expenditure).

“This was primarily due to reductions in Government’s expenditure on other goods and services by 35.6 per cent. Personnel Expenditure and Interest Payments were down by 6.75 per cent and 13.7 per cent respectively.
Overall for the three months to December 2014, a surplus of approximately $328.4 million was realised,” the ministry said.

Earlier yesterday, Finance Minister Larry Howai said with respect to the price of oil and spending, Government had no intention of increasing expenditure as it expected oil prices to continue to be down for some time again.
Government’s 2015 budget is now pegged on a revised oil price of US$45 a barrel, which is a 44 per cent reduction from the original benchmark of US$80 a barrel.

“We still think that we need to continue to do the things that the Prime Minister had outlined in terms of ensuring we maintain a reasonably balanced book as we go forward. We would like to reduce the deficit, but I still think it will be a little difficult.

Our first quarter numbers suggest that we actually performed a little bit better than we had anticipated but we will need to keep that sort of arrangement on track. We may have projected a billion-dollar deficit and we ended up with a surplus of about $300 million for first quarter fiscal.”

Howai was speaking with reporters following the opening of the LatinFinance Caribbean Investment and Finance Forum at the Hyatt Regency (Trinidad) hotel in Port of Spain.

The conference continues today.

Source:
By Leah Sorias
Trinidad Express
Thursday March 5, 2015

http://www.trinidadexpress.com/business/Govt-records-328m-budget-surplus-295102421.html