OREANDA-NEWS. Mr. David Lipton, First Deputy Managing Director of the International Monetary Fund (IMF), issued the following statement today:

“Following significant work at a technical level, a draft budget and supporting tax legislation were submitted to Parliament on December 11, 2015. It is with concern that we have observed the discussions yesterday in Parliament that effectively rejected the government’s proposals for a new tax code and the government budget for 2016. 

“Approval of a budget consistent with the program objective of reducing the general government deficit to 3.7 percent of GDP is a key condition for the completion of the second review under the EFF-supported program. At the same time, it is equally important that the budget is supported by structural reforms to remove exemptions and widen the tax base, as well as streamline government spending on a sustainable basis, which also are key objectives of the program. 

“Approval of a budget that deviates from program objectives for 2016 and the medium-term will interrupt the program and inevitably disrupt the associated international financing.”