The government says that it will refocus capital spending towards agriculture and infrastructure projects that can relieve supply bottlenecks, and we anticipate that there will be some new state spending on electricity generation and rural infrastructure over the forecast period. However, the country's public expenditure management is so weak, and the political incentives to keep it that way are so strong, that we are doubtful of a substantive reorientation in the government's capital expenditure patterns.

Economic policymakers in the government will come under increasing pressure from their EAC counterparts to bring themselves up to regional standards, and we believe this pressure will bring positive results. However, we doubt that the country's economic governance can be brought to a level within this period that would enable it to join the EAC's planned single currency in 2012, as currently envisaged, although it seems highly improbable that such a major step will actually be taken by EAC heads of state in two years' time. The recent, broadly positive assessment by the IMF of Burundi's economic reform programme under its extended credit facility (ECF) indicates that the government is likely to negotiate a replacement programme with the Fund when the current ECF expires in mid-2011.