GUATEMALA | Budget approved. Guatemala's congress has passed a new budget of Q54.3bn (US$6.8bn) for 2011, after two years of failed attempts. The budget for 2011 is 6% larger than the current (2008-approved) Q51.3bn (US$6.4bn) budget. It was approved by 113 of the 158 legislators: the right-wing opposition Partido Patriota (PP) voted against it. The deal-breaker was reportedly the inclusion of limits on transfers to government social programmes, such as Mi Familia Progresa (Mifapro) and other institutions, which the ruling Unidad Nacional de la Esperanza (UNE) had previously resisted. The main beneficiary of the new budget is education, which saw its assignation increase some 22% to Q$9.3bn (US$1.1bn). This was followed by infrastructure and communications (Q$4.4bn/US$541.45m); health (Q$3.9bn/US$479.92m); interior (Q$3.3bn/US$406.08m) and defence (Q$1.6/US$196.89m). One of the portfolios to register the biggest drop was agriculture which saw its funds shrink from Q$830.6m (US$103.7m) to Q$631.4m (US$78.9m).
The new budget is based on real annual GDP growth of 2.1% and envisages a fiscal deficit of 2.8% of GDP, with 77% of revenue to come from taxes. This in turn is dependent on the congressional approval of a tax evasion bill which aims to boost the tax take to 10.8% of GDP, up from the current 9.9%.
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