CAIRO: The Ministry of Finance is set to borrow 79.5 billion EGP ($839.1 million) in treasury bills and bonds during July, amid ongoing efforts to fill a soaring budget deficit, the ministry announced in a Sunday statement.
In June, the MOF borrowed 65.2 billion EGP in treasury bills.
Since the January 25 Revolution in 2011 that removed Hosni Mubarak, the government has borrowed from banks operating in Egypt to cover the budget deficit; at the end of this fiscal year it is expected to range between 11 to 12 percent of GDP at 200 billion EGP,compared to 10.5 percent of GDP in the year before.
“The MOF plans to auction 63.5 billion EGP in treasury bills, in addition to 16 billion EGP in treasury bonds during July, the first month of the 2014/2015 fiscal year,” the statement added.
During the first quarter of the new FY, the government plans to auction 224.5 billion EGP, up from 204.8 billion EGP in the previous quarter that ends June 30.
Egypt’s budget deficit recorded 163.3 billion EGP, representing 8 percent of the country’s GDP during the 10 months of the current fiscal year, down from 10.5 percent of GDP valued at 183 billion EGP in the same period in 2013, MOF said in an April report.
Meanwhile, Cairo is expected to receive generous aid from the Gulf States following Abdel Fatah al-Sisi’s landslide victory in the presidential election. Experts predicted that Sisi’s inauguration will pave the way for pending aid and grants, especially after talks resume with the International Monetary Fund (IMF).
Saudi King Abdullah bin Abdul Aziz called for a donor conference to help boost the Egyptian economy in a congratulatory message to Sisi, although the date of the conference has not been set.
Kuwait and the United Arab Emirates pledged the interim government around $12 billion after the removal of former Islamist president Mohamed Morsi in the wake of the events of June 30 in 2013.