Primary deficit retreats to 0.2% in Q1 of FY 2017/18

CAIRO – 8 November 2017: Egypt’s primary deficit in the budget stood at 0.2 percent of GDP in the first quarter (Q1) of fiscal year (FY) 2017/2018, compared to 0.6 percent in Q1 of FY 2016/2017, Deputy Minister of Finance for Fiscal Policies Ahmed Khouchouk said Wednesday.

Speaking about the developments of the International Monetary Fund’s (IMF) ongoing mission to Egypt, Khouchouk said the reduction in primary deficit came as a result of increasing revenues by 33.2 percent year-on-year.

Budget expenditures also went up 24.4 percent. “These figures represent the fiscal impact of implementing the first and second phases of the economic reform program,” Khouchouk said.

“The government is committed to rationalize public expenditures and redirect these funds to the budget deficit, social safety programs, development of human resources and improving infrastructure,” he said.

The IMF stressed on the importance of achieving a primary surplus in FY 2017/2018 for the first time, in tandem with reducing the domestic debt to 98 percent of the GDP.

The budget deficit is expected to stand at LE 322 billion by the end of fiscal year 2017/2018, to be filled by treasury bills and bonds issued by the Central Bank of Egypt (CBE) and through Arab and foreign loans and grants.