Identifier
Created
Classification
Origin
07LAPAZ299
2007-02-07 11:21:00
UNCLASSIFIED
Embassy La Paz
Cable title:
SOCIAL SPENDING DECLINED IN 2006
how-toVZCZCXYZ0006 PP RUEHWEB DE RUEHLP #0299 0381121 ZNR UUUUU ZZH P 071121Z FEB 07 FM AMEMBASSY LA PAZ TO RUEHC/SECSTATE WASHDC PRIORITY 2347 INFO RUEHAC/AMEMBASSY ASUNCION 6512 RUEHBO/AMEMBASSY BOGOTA 3836 RUEHBR/AMEMBASSY BRASILIA 7718 RUEHBU/AMEMBASSY BUENOS AIRES 4964 RUEHCV/AMEMBASSY CARACAS 2205 RUEHPE/AMEMBASSY LIMA 2294 RUEHMD/AMEMBASSY MADRID 3300 RUEHMN/AMEMBASSY MONTEVIDEO 4386 RUEHQT/AMEMBASSY QUITO 4848 RUEHSG/AMEMBASSY SANTIAGO 9436 RUEHC/DEPT OF LABOR WASHINGTON DC RHMFIUU/HQ USSOUTHCOM MIAMI FL RUMIAAA/USCINCSO MIAMI FL RUEHUB/USINT HAVANA 0126 RHEHNSC/NSC WASHINGTON DC RHEBAAA/DEPT OF ENERGY WASHINGTON DC RUCPDOC/DEPT OF COMMERCE WASHINGTON DC RUEATRS/DEPT OF TREASURY WASHINGTON DC
UNCLAS LA PAZ 000299
SIPDIS
SIPDIS
STATE FOR WHA/AND
TREASURY FOR SGOOCH
ENERGY FOR CDAY AND SLADISLAW
E.O. 12958: N/A
TAGS: ECON EFIN PGOV BL
SUBJECT: SOCIAL SPENDING DECLINED IN 2006
REF: LA PAZ 1660
UNCLAS LA PAZ 000299
SIPDIS
SIPDIS
STATE FOR WHA/AND
TREASURY FOR SGOOCH
ENERGY FOR CDAY AND SLADISLAW
E.O. 12958: N/A
TAGS: ECON EFIN PGOV BL
SUBJECT: SOCIAL SPENDING DECLINED IN 2006
REF: LA PAZ 1660
1. Despite a year-end 2006 estimated fiscal surplus of almost
six percent and an increase in government revenues of
approximately 41 percent, social spending by the GOB declined
by around six percent last year. Government revenue
increases resulted from increased customs and general tax
collections, domestic hydrocarbons sales and hydrocarbons
taxes (USD 1 billion in 2005 to an estimated USD 1.6 billion
in 2006),and foreign donations. Although health and
education expenditures increased, in part due to a seven
percent salary increase for workers in these sectors,
sanitation and housing expenditures declined. Total public
investment increased 17 percent in 2006 over 2005 figures,
but expenditures were focused on infrastructure, production
support, and extractive sectors. The national road service
and prefectures (regional governments) had the lowest
execution rates of their projected budgets -- 42 percent and
48 percent respectively -- due to reorganization, weak
implementation capacity, and difficulty obtaining approval
for projects from the central government.
2. Comment: In spite of the GOB's statist economic plan
(reftel) and booming revenues, public investment increased
only modestly in 2006, while social spending actually
declined. The low level of spending reflects more the GOB's
and regional government's limited executing capacities than
the Movement Towards Socialism (MAS) government's spending
intentions, which are reflected in its projected 2007 budget
deficit of three percent. End comment.
Public Investment
(in millions of USD)
2005 2006(e)
Infrastructure 326 427
Production Support 101 114
Extractive Sectors 7 11
Social Spending 195 183
Health 41 53
Education 43 45
Sanitation 51 41
Housing 60 44
Total Public Investment 629 735
GOLDBERG
SIPDIS
SIPDIS
STATE FOR WHA/AND
TREASURY FOR SGOOCH
ENERGY FOR CDAY AND SLADISLAW
E.O. 12958: N/A
TAGS: ECON EFIN PGOV BL
SUBJECT: SOCIAL SPENDING DECLINED IN 2006
REF: LA PAZ 1660
1. Despite a year-end 2006 estimated fiscal surplus of almost
six percent and an increase in government revenues of
approximately 41 percent, social spending by the GOB declined
by around six percent last year. Government revenue
increases resulted from increased customs and general tax
collections, domestic hydrocarbons sales and hydrocarbons
taxes (USD 1 billion in 2005 to an estimated USD 1.6 billion
in 2006),and foreign donations. Although health and
education expenditures increased, in part due to a seven
percent salary increase for workers in these sectors,
sanitation and housing expenditures declined. Total public
investment increased 17 percent in 2006 over 2005 figures,
but expenditures were focused on infrastructure, production
support, and extractive sectors. The national road service
and prefectures (regional governments) had the lowest
execution rates of their projected budgets -- 42 percent and
48 percent respectively -- due to reorganization, weak
implementation capacity, and difficulty obtaining approval
for projects from the central government.
2. Comment: In spite of the GOB's statist economic plan
(reftel) and booming revenues, public investment increased
only modestly in 2006, while social spending actually
declined. The low level of spending reflects more the GOB's
and regional government's limited executing capacities than
the Movement Towards Socialism (MAS) government's spending
intentions, which are reflected in its projected 2007 budget
deficit of three percent. End comment.
Public Investment
(in millions of USD)
2005 2006(e)
Infrastructure 326 427
Production Support 101 114
Extractive Sectors 7 11
Social Spending 195 183
Health 41 53
Education 43 45
Sanitation 51 41
Housing 60 44
Total Public Investment 629 735
GOLDBERG