CAIRO: Egypt’s overall budget deficit soared to 107.9 billion EGP (around 4.6 percent of GDP) during the first five months of the fiscal year 2014/15 (July-November), compared to 65.9 billion EGP (3.3 percent of GDP) during the same period in the previous FY, the Ministry of Finance revealed in its Economic Performance Report.
The ministry attributed the rise to an increase in expenditures to 231.8 billion EGP, up from 190.7 billion EGP in the same period a year earlier, according to the report issued Saturday.
At the same time, revenues dropped to 126 billion EGP, representing 5.4 percent of GDP since July to November-end, compared to 126.7 billion EGP in the same period last year.
Egypt’s budget deficit is a key challenge to the current administration that decided to cut energy, gas and food subsidies, in addition to imposing exceptional taxes in an attempt to control such a soaring deficit.
“Budget deficit is estimated to reach 240 billion EGP (10 percent of GDP) and may surge to 14 percent of GDP if no reforms are applied during 2014/15 FY,” the report stated.