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Egypt taps into budget reserves: Finance ministry

Government will allocate LE1.3 billion from extra budget funds to general expense items and LE900 million to petrol purchases, says a statement

Ahram Online, Sunday 18 Mar 2012
Egypt cash
Government pumps back-up funds into energy and infrastructure projects (Photo: Reuters)
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Egypt's government will reallocate LE1.3 billion ($217 million) from its budget reserves to its general expenses, the Ministry of Finance announced on Sunday.
 
A sum of LE900 million will be redirected in order to purchase much-needed petrol, raising Egypt's total annual allocations to the general petroleum authority to LE17.7 billion, the ministry said in a statement.
 
Egypt has been facing persistent problems in supplying adequate amounts of cooking gas and petrol fuel to citizens since the beginning of the year.
 
Last week, Momtaz El-Saeed, Egypt’s minister of finance announced that the annual budget deficit for the 2011/12 financial year has been revised downwards to LE144 billion, 9.1 per cent of GDP. The deficit was originally projected at LE134 billion, or 8.4 per cent.
 
This reallocation is a standard procedure which does not affect the budget's end results. 
 
Budget reserves are funds put aside for every item of expenditure to cover any price fluctuations or a shift in priorities. They are tapped into almost every financial year.
 
Among the new allocations are LE146 million given to Egypt's agriculture bank in order to subsidise farmers. The transportation authority will also receive a further LE87 million to continue revamping Cairo's underground, which recently saw the opening of its third line.
 
Egypt is currently negotiating $3.2 billion in budgetary support from the International Monetary Fund (IMF). A delegation from global body is due to arrive in Cairo on Sunday to finalise the deal. 
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