Ministry of Finance has revealed that the government has decreased expenditure by 20% in the first six months of this year, as part of the measures taken in response to the changes in the global economy.
Speaking to PSM News, Chief Financial Budget Executive Saruvash Adam said the biggest challenge was responding to the changes in global oil prices, noting that the Russia-Ukraine conflict had not begun when this year’s state budget was formulated. He said that the conflict has resulted in huge changes to oil prices and placed a heavy burden on subsidies, and that the oil prices have not dropped as they had done during other global crises.
Furthermore, Saruvash said despite the cost of the national health insurance Aasandha, the government has been able to reduce operational costs in all areas as part of efforts to respond to the changes in the global economy. He said that these efforts have resulted in a 20% decrease in expenditure in the first six months of this year. He said the finance ministry has been continuously sending circulars to control government expenditure while formulating plans to manage costs in the near future.
Additionally, Saruvash said the Gross Domestic Product (GDP) to cost is 40% while revenue is at 28% and that changes need to be made to expenditure and revenue to implement a sustainable fiscal policy. As such, he said that the ministry plans to change the GDP to cost by 3% by implementing subsidy reforms, changing capital allocation to state-owned companies, financing projects, and decreasing the number of new hires for state institutions.