Estimated budget deficit in 2018/19 stands at LE 430.8B

CAIRO – 15 April 2018: The preliminary financial statement for the 2018/2019 budget estimated a budget deficit of LE 438.59 billion, compared to LE 430.8 billion ($24.42 billion) as an expected deficit of 2017/2018 budget, with an increase of LE 7.5 billion.

Egypt targets a budget deficit of 8.4 percent of gross domestic product (GDP) in the new budget of fiscal year 2018/19, which will start on July 1.

The budget deficit represents the cash deficit of the public budget that can be added to or subtracted from the net of financial assets; the budget deficit is the deficit that requires the search for sources of financing.

According to a preliminary financial statement, the financial assets’ net in the new budget amounts to LE 3.76 billion, while the cash deficit marks LE 434.8 billion, representing 8.3 percent of the targeted GDP.

The net of financial assets represent what the public treasury pays as financial contributions or loans subtracted by the resources it receives as a repayment for the loans.

The Finance Ministry issued Friday the preliminary financial statement for the 2018/2019 budget for the third year in a row.

Egypt targets a budget deficit of around 6.2 percent of GDP in fiscal year 2019/2020, a statement from the Finance Ministry said Friday.

In January, Deputy Minister of Finance Mohamed Mait told Reuters that Egypt’s budget deficit is expected to reach 9.4 per cent of GDP in the current fiscal year 2017/18.

Egypt’s 2018/19 budget is currently up for discussion in the Parliament. The new budget targets a GDP growth of 5.8 percent, up from 5.2 percent in the current fiscal year, expenditure of LE 1.41 trillion and investment worth LE100 billion, up from LE70 billion in the current budget.

While the new budget will see a 15.5 percent increase in expenditure, it also seeks to increase revenues by 22 per cent. The new budget targets reducing the unemployment rate to 11 percent.