Egypt's draft 2022/23 budget projects spending to rise by 15%
Newspaper Title: https://www.reuters.com/
Newspaper Number:
Monday - 9 May 2022
CAIRO, May 9 (Reuters) - Egypt expects spending to rise by 15% and its budget deficit by 14.5% in the fiscal year that begins on July 1 as it faces fallout from the Ukraine crisis and continued pain from the coronavirus pandemic, the finance minister told parliament on Monday.
Spending for the 2022/23 fiscal year will rise to 2.07 trillion Egyptian pounds ($112 billion) from a projected 1.79 trillion pounds this year, he said, presenting his draft budget to lawmakers.
Revenue will increase to a projected 1.52 trillion from 1.30 trillion pounds in 2021/22. This will result in a deficit of 558.2 billion pounds, up from 487.7 billion.
"The global crisis has resulted in increased energy and food prices. The government has been able to confront the severe and simultaneous shocks because of the strength of the national economy," Mohamed Maait told parliament.
"The budget was prepared in the shadow of terrific challenges and pressures on the national economy during the international turmoil that has led to an increase in inflation."
The budget deficit is forecast at 6.1% of gross domestic product in 2022/23, down from an estimated 6.2% in the current financial year.
Interest payments on government debt will rise to 690.15 billion pounds in 2022/23, equivalent to 45.4% of all revenue, from 579.58 billion pounds this year. Interest payments are expected to account for 44.6% of government revenue this year.
The budget allocates 90 billion pounds for food subsidies, up from 87 billion pounds this year, the finance ministry said.
It projects that the price of oil will increase to an average $80 per barrel in 2022/23 from $75 this year.
The government forecasts that economic growth will slow marginally to 5.5% from 5.7% this year and that inflation will remain steady at 9%.
The average interest rate on government bills and bonds will rise to 14.5% from 13.7%, the ministry said.
