Egypt's budget deficit increased reaching about 5.7 percent of GDP, during first half of fiscal year 2014/15, compared to a deficit of 4.5 percent during July-December 2013/14, the Finance Ministry said on Wednesday.
The financial monthly bulletin for January 2015 explained the main reason behind the bloating budget deficit was the decrease in grants from Gulf countries, recording LE7.8 billion during July-December 2014/2015 compared to about LE36.8 billion during the same period last year, which were exceptional grants received to aid Egypt in its democratic transition last year.
The bulletin also said the budget deficit increased by 47.7 percent to LE132 billion during H1-FY14/15 from LE89.4 billion during July-December 2013/14.
Total revenues recorded LE163.6 billion (7 percent of GDP) during July-December 2014/2015, declining by around LE11.9 billion compared to same period last year despite of the increase in tax revenues by 9.9 percent to record LE114 billion.
The reduction in non-tax revenues could be explained mainly due to the decline in grants during the period July-Dec 2014/2015
Total expenditures recorded LE287.4 billion (12.4 percent of GDP) during July-December 2014/2015, increasing by around LE25.4 billion (9.7 percent growth) compared to same period last year.
This increase in the total expenditures was mainly due to the increase in interest payments by LE10.4, the rise in other expenditures by LE4.7 billion, and the increase in purchases of non-financial assets (investments) by LE2 billion.
Meanwhile, subsidies, grants and social benefits recorded LE59.5 billion (2.6 percent of GDP) during the period of study compared to LE70.2 billion during same period last year.
