Last Update 17:26
Tuesday, 21 May 2019

High interest rates, oil prices drive slight rise in Egypt's budget deficit: Deputy finance minister

Ahram Online , Tuesday 30 Jan 2018
Finance ministry
Egypt's Finance ministry (Photo: Al-Ahram)
Views: 6509
Views: 6509

Egypt’s fiscal year 2017/18 budget deficit is expected to record 9.4 percent of GDP, up from a projected 9.1 percent in the budget for the current fiscal year, Deputy Minister of Finance Mohamed Maait told Reuters on Tuesday.

Egypt's budget deficit for fiscal year 2016/17, which ended last June, fell to 10.9 percent of GDP, down from 12.5 percent of GDP the previous year.

The expected increase comes on the back of high interest rates and an increase in global oil prices.

Brent crude recorded $69.18 per barrel on Tuesday, according to Bloomberg.

The Central Bank of Egypt (CBE) raised interest rates by 700 basis points since the November 2016 floating of the EGP, and has kept interest rates unchanged since July 2017.

In July 2017, the CBE raised the overnight deposit rate to 18.75 percent from 16.75 percent and the overnight lending rate to 19.75 percent from 17.75 percent.

The CBE is set to hold its next monetary policy committee meeting on 15 February to decide on interest rates.

The World Bank said in a report last October it expects Egypt's budget deficit to ease to 8.8 percent of GDP in the 2017/18 fiscal year, driven by an increase in tax revenues as well as fuel subsidy reforms.

Egypt’s tax revenues increased by 62 percent year-on-year to EGP 249 billion in the first half of fiscal year 2017/18, the Finance Ministry announced earlier this month. 

Egypt's primary budget deficit hit a 10-year low in H1 2017/18, falling to 0.3 percent of GDP, down from 1.1 percent of GDP in the same period last year, the Finance Ministry announced earlier this month. 

Short link:


Ahram Online welcomes readers' comments on all issues covered by the site, along with any criticisms and/or corrections. Readers are asked to limit their feedback to a maximum of 1000 characters (roughly 200 words). All comments/criticisms will, however, be subject to the following code
  • We will not publish comments which contain rude or abusive language, libelous statements, slander and personal attacks against any person/s.
  • We will not publish comments which contain racist remarks or any kind of racial or religious incitement against any group of people, in Egypt or outside it.
  • We welcome criticism of our reports and articles but we will not publish personal attacks, slander or fabrications directed against our reporters and contributing writers.
  • We reserve the right to correct, when at all possible, obvious errors in spelling and grammar. However, due to time and staffing constraints such corrections will not be made across the board or on a regular basis.

© 2010 Ahram Online.