Egyptian Minister of Finance (Photo: Ahram)
Egypt’s total budget deficit recorded 10.6 percent of the country's gross domestic product (GDP) in the first ten months of the 2012/13 fiscal year, the finance ministry revealed on Thursday.
According to the ministry's May bulletin, the deficit has reached LE184.8 billion (roughly $26.4 billion), compared to LE117.8 billion (roughly $16.8 billion) in the period from July to April of the 2011/12 fiscal year.
Egypt, which is currently in the process of finalising an economic reform programme upon which a long-awaited $4.8 billion IMF loan is conditional, expects its budget deficit to hit 11.5 percent of GDP – roughly LE200 billion (some $28.75 billion) – by the end of the current fiscal year ending in June.
Meanwhile, as of the end of last year, the state’s total external debt had risen by 15.1 percent to $38.8 billion, representing 14.1 percent of national GDP.
The finance ministry attributed the rise in Egypt's external debt to financial aid that was provided by Qatar – worth $2 billion – in the second quarter of the current fiscal year.
Earlier this month, Egypt received a $3 billion deposit from the energy-rich Gulf nation in hopes of shoring up national finances that have been hard hit by economic and political turmoil since the 2011 popular uprising that toppled autocratic president Hosni Mubarak.
The fresh funds will remain with the Central Bank of Egypt (CBE) until the finance ministry issues bonds of the same value to Qatar, explained one CBE official who asked not to be named. The three-year bonds will bear an interest rate of 3.5 percent.