CAIRO: The Central Bank of Egypt (CBE) on behalf of the Ministry of Finance is scheduled to auction 6.5 billion EGP ($851.90 million) in treasury bills Sunday, according to the bank’s official website.
The T-bills are scheduled to be offered in two installments: the first valued at 2.5 billion EGP with a 91-day term, and the second worth 4 billion EGP with a 273-day term.
Egypt’s government intends to borrow 455 billion EGP during fiscal year FY2014/15 (to end June 30,) in order to filling a soaring budget deficit that widened to 186 billion EGP (around 8 percent of GDP) during the first eight months of FY14/15, up from 124 billion in the same period last year, according to the Finance Ministry’s monthly report.
The wider deficit was mainly attributed to a delay in settling taxes of the Egyptian General Petroleum Corporation (EGPC) and a decline in grants.
Egypt’s overall budget deficit was estimated at 14 percent of the nation’s GDP for FY 2014-15, before President Abdel Fatah al-Sisi ratified a revised and tightened budget in July with an estimated 10 percent shortfall, in a move towards applying austerity measures.
Sisi raised fuel prices as energy subsidies were slashed in the revised budget to 100.3 billion EGP, compared to 144 billion EGP in the previous year, saving around 44 billion EGP.
Egypt’s fuel subsidy bill amounted to 44.7 billion EGP ($5.85 billion) in the 1st half of this fiscal year, the Ministry of Finance announced last week.
The government has said it plans to remove energy subsidies completely within three to five years, without affecting the low-income class.