Finance Minister Ahmed Galal (Photo: Finance Ministry)
Egypt’s government is depending primarily on financial aid from the Gulf, the country's finance minister Ahmed Galal said on Saturday.
Speaking to CNN, Galal said that Gulf aid and an expansionary policy are the two pillars that the interim government will rely upon to achieve its goals, namely cutting 4 percent of its budget deficit and raising the growth rate to around 3.5 percent.
Supported by more than $12 billion in Gulf aid, Egypt’s interim government introduced a LE30 billion stimulus package in 2013 to be spent on public investments and a new minimum wage scheme.
While the details have not yet been announced, Saudi Arabia and the UAE are expected to give Egypt up to $5.8 billion in additional aid in the form of central bank deposits and petroleum products, Egyptian daily newspaper Al-Ahram reported on Thursday.
Egypt's budget deficit recorded LE74.5 billion ($10.8 billion) in the first four months of the current fiscal year 2013/14, representing a 7 percent rise year on year, according to the finance ministry's latest report.
The report added that the total budget deficit for the fiscal year 2013/14 is expected to reach some LE186 billion ($27 billion), the equivalent of 9 percent of the GDP, as compared to 14 percent -- LE240 billion ($34.8 billion) -- in the fiscal year 2012/13.
Following three years of political turmoil, Egypt’s economy grew a mere 1.04 percent between July and September 2013.