Domestic and external imbalances have been successfully addressed over the last decade. Fiscal consolidation led to a steady reduction in the budget deficit over the period 2001-05 and it has been maintained at below 2% of GDP since then. The central government debt as a percentage of GDP declined from a peak of 90% in 2000 to 28% in 2009 (OECD, 2010a). The country is currently well-placed to finance the short term costs of some of the reforms in the agro-food sector proposed below.