Egypt Independent

Deficit in new budget exceeds LE140 bln

The total amount of resources in the new budget is estimated at LE350 billion and the deficit stands at LE141 billion, or 8.6 percent of the gross domestic product, said Finance Minister Momtaz al-Saeed, adding that the amount of the deficit is a cause for concern.

In his speech before Parliament on Tuesday, Saeed added that the budget for the new fiscal year has been prepared under difficult circumstances and was amended four times in response to popular pressure. He added that there is an acute liquidity shortage.

According to state-run Al-Ahram newspaper, the budget was prepared in a rush and a state of confusion.

The finance minister said expenditures amount to LE117 billion compared to LE97 billion in the previous year. The minister also said that of the LE40 billion allocated to bonuses, LE4 billion could have been saved.

The minister also said that the total amount of energy subsidies is estimated at LE95 billion, of which LE45 billion are for diesel and LE20 billion for butane gas.

Saudi Arabia and Qatar each gave Egypt US$500 billion in grants, he said.

Earlier this month, Saeed told reporters the World Bank will give Egypt a total of US$2 billion over two years as it had pledged earlier and $500 million in immediate financial assistance.

Egypt will also seek US$1 billion in loans from the World Bank and the African Development Bank and has applied for a US$3.2 billion loan from the International Monetary Fund.