After two years of rapid economic recovery, reflected in real GDP growth of
about 10 percent a year, we anticipate solid but more moderate real growth of about6 percent in 2007. Moreover, we have managed to reduce the 12-month inflation rate from a high of 65 percent a year in 2004 to 5 percent in 2006, at the lower bound of the target range of 5-7 percent. For 2007 we envisage a further reduction in annual inflation, subject to DRCAFTA becoming effective shortly, to which end we will continue pursuing a prudent monetary policy. The current account of the balance of payments performed slightly better than anticipated in 2006, and based on preliminary data we estimate that the year ended with a deficit between
2-2½ percent of GDP, partly reflecting greater buoyancy in exports and a lower-than-projected oil import bill. For 2007 a small improvement in the current account is anticipated as a result of the recent decline in oil prices, though non-oil imports are expected to rise (especially capital goods) to support the continuing growth of the economy.