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Analysis of the President's Budget for 2004: Looking for the Complete (Fiscal) Picture

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  • Manasan, Rosario G.

Abstract

The President’s Budget for 2004 is the administration’s last prior to the forthcoming presidential elections in May 2004. Thus, it is but timely to assess not only the proposed 2004 budget itself but also the present administration’s fiscal performance in the last three years. The evaluation of the President’s Budget for 2001-2004 that is presented in this paper is composed of three parts: (i) an evaluation of the overall fiscal outlook as projected in the President’s Budget in terms of its sustainability; (ii) an examination of its revenue program; and (iii) the congruence of the expenditure program with policy pronouncements and budgetary intent as articulated in the Medium-Term Development Plan (MTPDP). This paper also highlights why it is critical to always have a comprehensive picture of the public sector. It documents how the positive fiscal outlook for the national government in 2003-2004 masks the rapid deterioration in the fiscal position of the nonfinancial public sector mainly because of the huge losses registered by a number of GOCCs. While the nonfinancial public sector in the aggregate is projected to have a small primary surplus in 2004 after posting primary deficits in 2002-2003, its consolidated fiscal position is deemed to be unsustainable in 2003-2004. The solutions to this problem are not easy: increasing tariffs, privatization and regulatory reform.

Suggested Citation

  • Manasan, Rosario G., 2003. "Analysis of the President's Budget for 2004: Looking for the Complete (Fiscal) Picture," Discussion Papers DP 2003-17, Philippine Institute for Development Studies.
    • Handle: RePEc:phd:dpaper:dp_2003-17
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    References listed on IDEAS

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    1. Mr. Nigel A Chalk & Mr. Richard Hemming, 2000. "Assessing Fiscal Sustainability in Theory and Practice," IMF Working Papers 2000/081, International Monetary Fund.
    2. Anand, Ritu & van Wijnbergen, Sweder, 1989. "Inflation and the Financing of Government Expenditure: An Introductory Analysis with an Application to Turkey," The World Bank Economic Review, World Bank, vol. 3(1), pages 17-38, January.
    3. Murray Petrie & Mr. Richard Hemming, 2000. "A Framework for Assessing Fiscal Vulnerability," IMF Working Papers 2000/052, International Monetary Fund.
    4. Manasan, Rosario G., 2002. "Estimating Industry Benchmarks for the Value Added Tax," Discussion Papers DP 2002-11, Philippine Institute for Development Studies.
    5. repec:phd:pjdevt:pjd_2002_vol__xxix_no__2-a is not listed on IDEAS
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    Cited by:

    1. World Bank, 2005. "Philippines : From Short-Term Growth to Sustained Development," World Bank Publications - Reports 8552, The World Bank Group.

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