Key developments and challenges

The authorities have embarked on an ambitious reform programme. It includes major cuts in the number of licences and inspections, as well as plans for radical reforms in public administration, fiscal policy, mining and energy.

The economy grew strongly in 2011 but contracted in the first half of 2012. Real GDP grew by 5.7 per cent in 2011 after a decline in 2010, but problems at the biggest mining site in February 2012 caused a temporary economic contraction in the first half of the year.

The fiscal framework has been strengthened. Key measures included the establishment of a public financial management committee, extension of treasury coverage of general government operations and adoption of a medium-term debt management strategy.