FinMin gives update on fiscal performance as the IMF arrives in Cairo: The budget deficit shrank to 5.3% of GDP in the first nine months of FY2018-19, compared to 6.2% in the same period a year earlier, Finance Minister Mohamed Maait announced in a press conference yesterday, according to a ministry statement (pdf). The primary budget surplus rose to EGP 35.5 bn (0.7% of GDP) during the period, up from EGP 7 bn (0.2%) a year earlier. Results bode well for ministry’s June-end target to reduce the debt-to-GDP ratio to 93%,Maait said. The ministry’s four-year debt control strategy aims to reduce the ratio to 80-85% of GDP by the end of FY2021-22.

Other key takeaways from the presser:

• Foreign holdings in Egyptian treasuries stood at USD 16.8 bn by the third week of April, up from USD 15.8 bn at the end of February.
• Inflation: The ministry is targeting an inflation level of no more than 10% in the coming fiscal year, and between 6 and 7% in FY 2020-21.
• Tax and non-tax state revenues continue to outgrow spending: Tax collections and other revenues grew at 20.3% to EGP 598.7 bn during the nine months, a rate faster than the 13.9% growth in state spending, which came at EGP 879 mn during the period.

The press conference came as an IMF delegation arrived in Cairo to conduct its final review of the economic reform program. The review will determine whether the fund disburses the sixth and final tranche of the USD 12 bn facility in July.