Government committed to enhancing public services while managing debt

TDT | Manama

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The Ministry of Finance and National Economy has reaffirmed the government’s commitment to improving the quality and efficiency of public services while maintaining economic stability and growth.

In a statement, the ministry emphasised that enhancing fiscal performance is expected to generate budget surpluses, which will be directed toward reducing public debt and strengthening its long-term sustainability.

The announcement comes as public debt reached BD17.9 billion, with interest payments amounting to BD843 million, according to the ministry’s latest figures. The data, sourced from the state’s final accounts for the financial year ending December 31, 2023, was disclosed in response to a parliamentary inquiry by MP Khalid Buanaq.

This comes following a ministry report that shows public debt has reached BD17.9 billion, with interest payments standing at BD843 million.

The figures, drawn from the state’s final accounts for the financial year ending 31 December 2023, were disclosed in response to a question from MP Khalid Buanaq.

Final accounts

Work is in progress on the final accounts for 2024, with the ministry stating that the report will be sent to Parliament once completed.

Debt is repaid through local and overseas financial markets or, where possible, from surplus funds.

The ministry linked the borrowing to shortfalls in the budget, citing Article 6 of the General Budget Law, which allows for borrowing from financial institutions and Arab and Islamic funds to cover shortfalls.

Approach

As long as deficits persist, borrowing will remain part of the approach. The ministry noted that debt levels should not be looked at in isolation but alongside economic growth.

Gross domestic product recorded an average yearly rise of 9 per cent from 2021 to the end of 2023.

On debt management, the ministry said the approach is shaped by the government’s financial policy, with funding needs and repayments assessed to keep costs as low as possible.

Cash flow Borrowing schedules are arranged to ease pressure on cash flow.

A range of measures is being rolled out as part of the Fiscal Balance Programme and the Economic Recovery Plan, with the government working to lift revenue, broaden income sources, and cut day-to-day costs.

“The government is working to raise the standard and efficiency of public services while keeping the economy on an upward track,” the ministry said. “This is expected to help build surpluses that can be fed back into reducing public debt and improving its long-term outlook.”