Egypt records state budget deficit of 2.1% in 1Q2019-20
BUDGET WATCH- State records budget deficit of 2.1% in 1Q2019-20: The Finance Ministry’s latest fiscal performance report (pdf) showed a budget deficit of EGP 131.5 bn (2.1% of GDP) in the first quarter of FY2019-2020, compared to EGP 102.4 bn (1.9%) in July-September of FY2018-2019. Revenues for the quarter came in at EGP 173 bn, down slightly from EGP 174.5 bn in 1Q2018-2019. Overall expenses, meanwhile, increased to EGP 303.3 bn, from EGP 276 bn in 1Q2018-2019. This was driven by a large rise in the interest bill to EGP 138.5 bn, from EGP 109.5 bn. The ministry achieved a primary surplus of EGP 7.1 bn (0.11%) in the first three months of the fiscal year, stripped of interest spending. The ministry expects to record an overall deficit equal to 7.2% of GDP by the end of the fiscal year.
Egypt’s GDP is expected to grow at an annual clip of at least 5.5% over the next few years, according to a quarterly report prepared by Cabinet’s Information and Decision Support Center. The report attributed the growth to government spending on infrastructure, services, oil, and gas. Tourism contributed around 20% of Egypt’s GDP in 2019, according to the report.