ZIMBABWE’S Finance Minister, Simba Makoni, says the projected budget deficit for 2000 has been raised to 14.9% of gross domestic product (GDP) from 3.8% due to a higher wage bill and defence spending. Makoni said the budget deficit was expected to soar because of an increase in the public sector wage bill, the government interest bill and unbudgeted costs arising from the Constitution referendum and defence procurement. Zimbabwe’s budget deficit has averaged 10% percent over the last decade. Makoni said the country’s foreign currency reserves had dropped to US$298m in mid-July from US$713m in 1996. ”This development is seriously constraining the country’s capacity to meet its external debt obligations as well as payments for critical imports.” – Reuters
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