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Thursday, 25 July 2024
Egypt projects borrowing needs will climb 7.1 percent in 2021/22
Egyptians walk in front of the Egyptian Central Bank in Cairo on Nov. 3, 2016. (File photo: AP)

Egypt expects its borrowing needs to rise by 7.1 percent to 1.068 trillion Egyptian pounds ($68.1 billion) in the financial year that will begin in July, according to a copy of the draft budget.

The government projected raising 66 billion pounds of this by selling international bonds, down from 72 billion pounds this year, said the draft seen by Reuters.

Finance Minister Mohamed Maait told parliament on Sunday that 2021/22 expenditure would be 2.46 trillion pounds. The budget was based on economic growth forecast at 5.4 percent - up from an estimated 2.8 percent this year - and inflation of 7 percent.

The budget forecast an overall deficit equivalent to 6.8 percent of gross domestic product, down from 7.7 percent this year, and a primary surplus of 5.1 percent.

“If they are able to achieve that, it would be very positive,” said Allen Sandeep of Naeem Brokerage.

The government projected its fuel subsidy bill would drop by 35 percent to 18.4 billion pounds and its tax revenues would increase by 1.9 percent to 983 billion pounds.

Often the world’s largest wheat buyer, Egypt also projected it would provide 8.6 million tons of the grain to the public, of which it planned to import 5.1 million tons.

The draft budget projects an average interest rate of 13.2 percent on domestic treasury bills and bonds, down from 14 percent this year.

source: Reuters

Image source: AP