The budget for 2011 marks a return to capital spending, which had been all but frozen in 2009-10 in response to the loss of general budgetary support from donors. Health, education and infrastructure are set to be the main beneficiaries, although more initiatives are likely to be announced than are actually realised. These projects and election-related costs mean that total spending is expected to be up by around 20% in nominal terms on the total in the revised budget for 2010. The government is banking on a sharp rise in receipts from the mining sector to fund its spending plans. Global demand for the country's mineral exports is expected to ease in 2012, but this should be more than offset by extra investment in mining, so receipts from this sector should remain high. On the tentative assumption that democracy is restored in 2011, the consequent resumption of general budgetary aid in 2012 will result in even quicker growth in spending, of around 25%. In view of delays to the electoral timetable, we now expect a deficit equivalent to 0.9% in 2011 (compared with a surplus of 0.4% of GDP previously). Assuming aid flows resume in 2012 and royalties from the Ambatovy nickel-cobalt mine start to flow into the public coffers, we forecast a surplus of 1.2% of GDP in 2012 (previously 2.7%).