PORT-AU-PRINCE, HAITI- In his inauguration address to members of the new government, Prime Minister Ariel Henry mentioned that the State coffers were empty, that the deficit was rising, and that his government was operating on credit. He warned that “tightening the belt” would be necessary.
From the 256 billion Gourdes budget forecast for the fiscal year 2020 – 2021, 96 billion Gourdes were collected, 30 billion of which were used for fuel subsidies.
As a result, for each gallon of gasoline purchased at the pump at 201 dollars, the State loses 259 dollars (subsidy) and for each gallon of diesel bought at 169 dollars, the State loses 210 dollars.
According to the prime minister, if this situation continues, “we will not even be able to order fuel”.
Henry announces severe measures soon, convinced that the economy’s recovery will require an increase in taxes and the removal of petroleum product subsidies if we wish to avoid a fiscal deficit between 60 and 90 billion Gourdes during the 2021-2022 fiscal year as predicted by several economists.
However, the “propitious” moment of the effective announcement of the end of subsidies for petroleum products does not seem to have arrived yet, meaning that the Government is likely to hesitate between next December and the start of 2022, keeping in mind the violent riots of July 2018.