19. The following indicators give an overview of the economic situation in 2003. Table 16: Targets and outturn in Key Macroeconomic Variables, 2003 2002 Outturn Variable Real GDP Growth Rate 3.3 Money Supply Growth (annual % change) 31.4 Inflation Rate (end year) 26.7 Domestic Fiscal Deficit (% GDP) (4.1) Total External Debt $7 billion 2003 Target A 4.0 24.0* 17.1* (1.55) 2003 Outturn B 4.3 13.8 17.2 (5.1) Difference C=B-A 0.3 (10.2) 0.1 (3.5) Source: Ministry of Finance and National Planning *Revised Targets 20. The State Party wishes to report that its economic performance in 2003 was favourable, and that this continued in the year 2004. By end 2004 the revised GDP estimate was 5.0 per cent as compared to real GDP estimate of 4.3 per cent in 2003 and 3.3 percent in 2002. This expansion in growth was mainly attributed to the recovery of agricultural output from the effects of the 2001 drought. 21. Annual inflation fell from 27.6 per cent at end-2002 to 17.2 per cent at end-2003, owing to a fall in food prices, following a favourable food harvest. By the end of 2004, however, inflation had risen to 17.5 per cent. This increase in inflation was mainly attributed to the rise in oil prices on the world market and prices of other non food items, as well as the sluggish reduction in food prices. 22. In the financial market, commercial banks’ lending rates remained high in the first half of 2004. The average lending rate was recorded at 36.9 per cent in June 2004, from 45.6 per cent in December 2003. This was a significant drop from the 2002 figure of 53.1 per cent 29