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DE RUEHPU #1922 2791542
ZNR UUUUU ZZH
P 061542Z OCT 06
FM AMEMBASSY PORT AU PRINCE
TO RUEHC/SECSTATE WASHDC PRIORITY 4266
INFO RUEHZH/HAITI COLLECTIVE PRIORITY
RUEHBR/AMEMBASSY BRASILIA PRIORITY 1252
RUEHSA/AMEMBASSY PRETORIA PRIORITY 1091
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UNCLAS PORT AU PRINCE 001922 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR WHA/CAR 
EB/IFD 
S/CRS 
SOUTHCOM ALSO FOR POLAD 
STATE PASS TO USAID FOR LAC/CAR 
INR/IAA (BEN-YEHUDA) 
COMMERCE FOR SCOTT SMITH 
TREASURY FOR JEFFERY LEVINE 
WHA/EX PLEASE PASS USOAS 
 
E.O. 12958: N/A 
TAGS: ECON EAID PGOV PINS HA
SUBJECT: GOH APPROVES FY07 BUDGET 
 
REF: A. PAP 1880 
 
     ¶B. PAP 1648 
 
¶1. The GOH approved and published Haiti's FY07 budget 
September 30; parliament ratified the budget on September 28 
with slight modifications to the original document, including 
a reallocation of USD 25 million (ref A).  The budget totals 
USD 1.65 billion (64.57 billion Haitian gourdes), a 68 
percent increase over last year's budget.  Revenue collection 
represents 34 percent of the budget, with the international 
community funding the rest in grants (41.5 percent) and loans 
(24.4 percent).  Domestic financing accounts for salaries and 
operations; all other programs and investments are covered by 
international spending.  Priority areas of the budget are 
security, education, health and construction of roads, as 
outlined in the Prime Minister's general policy framework. 
FY07 fiscal goals are to achieve a four percent growth rate 
and meet the IMF target inflation rate of below ten percent. 
 
¶2.  The budget allocates 96.9 percent of the resources to the 
executive branch, .98 percent to the legislative branch, and 
.58 percent to the judicial branch.  Within this breakdown, 
the budget gives each line ministry a ceiling: 
 
-- 48.2 percent of the budget will go to rebuilding the 
economy:  Ministry of Planning and External Cooperation -- 
USD 234 million, Finance Ministry -- USD 107 million, 
Ministry of Agriculture -- USD 96.9 million, Ministry of 
Public Works -- USD 311 million, Ministry of Commerce -- USD 
11.5 million, and Ministry of Environment -- USD 21 million. 
 
-- 13.3 percent to advancing the political sector:  Ministry 
of Justice -- USD 216 million, Ministry of Haitian Living 
Abroad -- USD 2.64 million, Office of the President -- USD 
15.7 million, Office of the Prime Minister -- USD 12.9 
million, and Ministry of the Interior -- USD 43.1 million. 
 
-- 18.9 percent to the increasing social services: Ministry 
of Education -- USD 148 million, Ministry of Social Affairs 
-- USD 11.7 million, Ministry of Women's Affairs -- USD 2.7 
million, and Ministry of Youth and Sports -- USD 6.9 million. 
 
-- and .96 percent is devoted to cultural enhancement: 
Ministry of Religious Affairs -- USD 2 million and Ministry 
of Culture -- USD 8 million. 
 
¶3.  Comment: The executive, specifically the finance 
ministry, viewed the reallocation of USD 25 million 
unfavorably but published it regardless, in order to have the 
budget finalized by the start of fiscal year 2007, on October 
1, 2006.  The reallocated funds went to a controversial 
feasibility study on the re-establishment of a national 
security force and to even more controversial "pork-barrel 
politics" (ref A).  According to International Monetary Fund 
resrep Ugo Fasano, the money may have been allocated for a 
feasibility study and other far-fetched programs, but it does 
not mean the GOH will come up with sufficient funding.  The 
GOH has publicly stated their concern and said that it has 
"high hopes that the donors will honor their financial 
commitments," which account for 65 percent of the total 
budget. 
SANDERSON