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Brunei 2016 fiscal deficit may rise to nearly 2.8 billion USD

Xinhua, March 10, 2016 Adjust font size:

As low energy prices continue to weigh on Brunei's oil and gas dependent economy, the sultanate's fiscal deficit is projected to hit over B$3.8 billion (about 2.8 billion U.S. dollars) - equivalent to nearly 70% of the proposed national budget - for the incoming 2016-2017 fiscal year.

During the ongoing 12th Legislative Council Meeting, Brunei's Minister of Finance II Abdul Rahman said global oil prices have fallen over 70% since 2014 and in this context, government revenue for 2016-2017 is projected to reach B$1.76 billion, while the proposed budget for the same period is B$5.6 billion. This means Brunei will has to bear a B$3.84 billion budget gap for the coming fiscal year.

The projected deficit for the 2016-2017 fiscal year is about 68% higher than the B$2.28 billion deficit projected for the 2015-2016 fiscal year which will end on March 31, 2016.

As for projected revenue for the 2016-2017 fiscal year, Abdul Rahman said the oil and gas sector is projected to contribute B$854 million to the country's coffers while the non-oil sector will contribute B$910 million. The projected revenue from the oil and gas sector for the incoming fiscal year is over 70% lower than the B$3.21 billion projected for the 2015-2016 fiscal year.

"The figures for projected government revenue for 2016-2017 is based on a conservative estimate in order to help the government manage its finances more wisely and carefully," he said during the session.

The minister urged both the public and private sectors to maximise productivity, minimize wastage and avoid unnecessary spending. He also urged the need to diversify the economy.

Quoting statistics from the Department of Economic Planning and Development, the minister said the department forecasts the country's economy to contract by 1.1% last year and will back on track to grow by 2.3% for 2016.Enditem