FinMin ups budget deficit figure for FY2017-18 to 10.2% from 9.8%
EXCLUSIVE- Expect the FY2017-18 budget to target a deficit of 10.2%, up from the 9.8% initially forecast: The Finance Ministry will reportedly hike its projected budget deficit to 10.2% for the current FY2017-18 from an initial target of 9.8%, government sources tell Enterprise. This is still an improvement over the previous fiscal year’s deficit of 10.9%, those sources made sure to note. The amendment comes after the Ismail Cabinet approved an EGP 70 bn overdraft for the FY2017-18 state budget last week to cover “necessary expenditures.”
It was mostly debt service and some oil. None of this comes as a surprise: The overrun was largely due to rising debt service costs and higher oil prices. Egypt has reportedly been importing fuel at USD 75/bbl, up from an estimated USD 55/bbl in the budget.
IMF is not worried: The IMF is not causing a stir over the issue. “The IMF is understanding and is taking into consideration the changing global macro climate, so long as the economic reform program presses along,” one source close to cabinet said.