ABSTRACT
The government has had fiscal deficits in twenty-one of the last thirty years as a result of structural deficiencies that have been unable to establish a core tax revenue base to complement the volatile revenues from petroleum exports. The ups and downs of oil prices have led to boom and bust cycles in government coffers that have, in turn, resulted in a systematic source of debt accumulation with a bias toward increasing expenditures during oil upswings and not reducing them in downtimes, leading to a structural deficit. Despite various reforms that sought to increase nonpetroleum revenues and that managed to decrease the share of oil revenues in total central government revenues from 71 percent in the 1970s to about 35 percent by 1999, successive governments have failed to fully address the heart of the country’s fiscal problems.
