US Dollar notes |
The Monetary Policy Committee (MPC) of the CBG
states in its quarterly report, released on Friday, that grants (to The Gambia)
declined significantly from D1.8 billion (US$
5, 260, 000) in 2012 to D725.1 million (US$ 2,000,000) in 2013.
The Committee has not given any reason for this
negative development. However, in 2013, President
Jammeh abruptly withdrew The Gambia from the Commonwealth, and also cut diplomatic
relations with Taiwan; an organization, and a country that used to donate to
the country.
The MPC report states that provisional data on the
execution of the 2013 budget show that total revenue and grants amounted to
D5.9 billion (US$ 15, 790,000) , equivalent to 17.5 per cent of the country’s
Gross Domestic Product (GDP). This total
revenue is well below the target of D7.7 billion (US$ 21,056,000), or 20 per
cent of the GDP.
This steep difference in the targeted total revenue and
grants, and the amount realized is due to negative donor response from the
country’s donor partners.
Former National Assembly Member for Basse, Hon.
Sellu Bah, has earlier on said that The Gambia should not depend on grants to
finance its economy.
”Let us work as a nation to ensure that we collect
our domestic revenue to the letter to counter any negative response on grants,”
Hon. Bah said.
“I think this [huge reduction in grants] would teach
us a lesson,” he added.
Domestic
revenue increase
The Gambia has intensive revenue collection efforts
when its donor-partners are not forthcoming.
As a result, the country’s domestic revenue, comprising both tax and
non-tax revenue, increased by 10.6 percent to D5.2 billion in 2013.
However, the increase in domestic revenue has done
little to cushion the effect of the low flow of grants to The Gambia. As a result of the shortfall in grants and a
need for more expenditure, the government has increased its borrowing from
local sources, such as the commercial banks in the country, to balance the
difference.
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