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Economic Transformation: - Towards a Middle Income Economy

Strategic Objective:

To build a self-reliant economy aimed at eradicating poverty and ensuring prosperity, equity and sustainable development.

Policy Directives:

To eradicate an economy  with a narrow capital, investment , production and taxation base by focusing on prospecting and harnessing minerals, oil and other resources that are  sources of Sovereign National Wealth  for  public  sector  use in promoting  infrastructural development, sustainable and timely loan repayment scheme, and the  provision of social services, thus enabling the government to rationalise taxation by making it affordable and sustainable,  while  promoting  capital formation from all sectors of the economy, public, private, cooperative and informal , to ensure a balanced and proportionate growth of the productive base of the economy to eradicate poverty and promote prosperity.

The Public sector will be an engine for safeguarding general prosperity and welfare by accumulating sovereign National wealth and mobilising sustainable loans to build infrastructure and provide social services.  The Public Sector will mobilise Sovereign National Wealth from mining and other extracting industries; dividends from public enterprises and other public investments. Heavy minerals such as Illmenite, Rutile and Zircon have been found in the coastal strip of Bato Kunku, Sanyang and Kartong by Carnegie minerals before it ended its operations in The Gambia. There are also prospects for oil production and other minerals.

In the same vein, public enterprises had a turnover of 804 Million dalasis in 1998.  They contributed 18 percent of GDP and paid 68 Million dalasis into government coffers which amounted to 10 percent of the National budget. In 1999, the turnover increased to 940 Million amounting to 20 percent of GDP.  This sector contributed82 Million dalasis to the National budget in 1999 .However , in the 2014 budget Public enterprises contribution to Sovereign National Wealth  by way of dividends is nil.

In 2014, the estimated expenditure was 10.2 Billion dalasis. Without any accumulation of sovereign National Wealth from minerals, oil or dividends from public enterprises, the bulk of the money must come from taxation which results in the reduction of the consumption capacities of the people and the scaling down investment capacity of private enterprises.

PDOIS intends to encourage the Private sector to be an engine for mobilising capital and foreign direct investment for productive private sector investment, so that it could complement the aim of promoting poverty eradication and the enhancement of general welfare through corporate responsibility.

In recent years, approximately 1.6 billion dollars, amounting to more than 64,000 Million dalasis is exchanged annually in the foreign exchange market in the Gambia, while exports in 2012 earned the country only 92.6 Million dollars, or 3680 Million Dalasis. The investment of the private sector in the productive base of the economy falls far short of the volume of money that is currently in circulation.  The policy directive is to put an end to this trend and link private sector capital to private sector investment in the productive base of the economy.

The cooperative sector will be an engine for accumulating Cooperative finances for grassroots development. 

In 2007 alone rice import to the Gambia amounted to  557million dalasis, tomato paste, 121 Million dalasis; onions, 18 million dalasis ; flour, 130 Million dalasis ; vegetable oil, 457 Million dalasis; fruits and vegetables,  57 Million dalasis; Milk and  Milk products, 149 million dalasis. If agriculture is linked to processing by cottage or light scale industries, financed by cooperative financial institutions, a sum of over 1489 Million dalasis would have been put in the hands of Gambian producers in one year.

The Social Security and Housing Finance Corporation invested over 400 Million dalasis to purchase and refurbish Ocean Bay Hotel. Such sums of money should have been deposited in a Bank as shareholder, since only a sum of 200 Million dalasis is required to establish a bank. Such a Corporation in partnership with a bank could have provided the sum to a cooperative Marketing enterprise to purchase nuts at prices favourable to the farming community, and the loan could have been repaid within a year.  Such marketing cooperatives could also enhance processing by purchasing value added produce from small scale producers and provide refrigeration and transportation to markets. This could have put billions in the hands of farmers.

The informal sector will be the means for promoting a multiplier effect of development to the sectors that are not reached by the formal sector.

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