By Fatou Krubally
The Gambia’s fiscal deficit narrowed significantly during the first quarter of 2026, but the improvement was accompanied by a sharp decline in government capital expenditure, which fell by 36 percent compared with the same period in 2025.
The figures are contained in the government’s First Quarter 2026 Budget Performance Report, released Tuesday by the Ministry of Finance and Economic Affairs (MoFEA), covering government revenue and expenditure between January and March.
According to the report, the government recorded a fiscal deficit of D195.8 million during the first quarter, compared with D587.3 million recorded during the same period last year.
The ministry attributed the improvement to tighter expenditure management and revenue collection, which remained broadly on track.
However, capital expenditure stood at D738.7 million at the end of March, representing a 36 percent decline, equivalent to about D409 million, compared with the first quarter of 2025.
The ministry said the decline indicated slower implementation of development projects during the first three months of the year.
Overall government expenditure and net lending amounted to D7.87 billion, representing 22 percent of the approved annual budget and a three percent decline from the D8.13 billion recorded during the first quarter of 2025.
Current expenditure, however, increased by two percent year-on-year to D7.13 billion.
Personnel emoluments accounted for D2.45 billion, while subsidies and transfers amounted to D2.14 billion, representing 28 percent of their annual budget allocation.
Debt interest payments declined by 14 percent to D1.36 billion, with domestic interest payments accounting for 79 percent, or D1.08 billion, of total debt interest.
On the revenue side, domestic revenue stood at D7.68 billion, compared with D7.54 billion during the first quarter of 2025.
Tax revenue was the main contributor to the increase, rising by 12 percent to D7.19 billion from D6.40 billion a year earlier.
The report attributed the increase largely to improved VAT and domestic excise collections, the implementation of the digital tax stamp system and increased oil revenue following the government’s non-subsidy policy on petroleum products.
Direct taxes rose by 20 percent to D2.65 billion, supported by higher corporate and personal income tax collections.
Indirect taxes increased to D4.56 billion, driven by higher domestic VAT, import duties and import VAT collections.
Non-tax revenue, however, declined significantly, falling by 58 percent from D1.15 billion in the first quarter of 2025 to D485.9 million during the same period this year.
According to the ministry, the decline was largely due to a D709.99 million dividend received from the Central Bank of The Gambia in March 2025, which was not received during the first quarter of 2026.
The report further noted that the government received no budget support or programme grants during the first quarter of 2026.
While the ministry described the overall fiscal performance as broadly stable, it said non-tax revenue reporting and execution of the development budget would require close monitoring during the remaining quarters of the year.
The first-quarter figures therefore point to an improved fiscal balance alongside slower implementation of capital projects, highlighting the challenge of maintaining fiscal discipline while sustaining public investment in development programmes.
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