Matambo Faces Mammoth Budget Quandary

After a year characterised by a drop in government revenues, strong government spending and an estimated deficit of P14 billion, Matambo's debut budget presentation is a task he is unlikely to be relishing. While experts believe actual government revenues for the 2009/10 financial year will be higher than the projected P24.4 billion, budgeted expenditure is also likely to be higher than the projected P37.8 billion. This is largely due to government's decision to "spend its way out of the recession," or rather maintain spending levels in order to support economic activity.

The minister is expected to announce the budget in early February.
Matambo is also likely keeping a wary eye on foreign reserves, which took a knock last year as government dipped into them to finance the deficit. He will also be keeping an ear to the ground in terms of mineral prices, which traditionally are the second largest source of government revenue.