Egypt set to reduce budget deficit

Egypt's ruling military council on Monday approved the government's revised draft annual budget, which is set to post less of a deficit than originally forecast.

The draft budget for the year from July 2011 to June 2012 was endorsed by Field Marshal Hussein Tantawi, head of the Supreme Council of the Armed Forces, the finance ministry announced in a statement.

The government had to amend its original draft after submitting plans to run a budget deficit amounting to 11 per cent of GDP, because of a sharp rise in public spending.

The new draft projects a deficit to 8.6 per cent or 141 billion Egyptian pounds ($23.7 billion) by reducing state expenditure to 490.6 billion Egyptian pounds, with revenues estimated at 349.6 billion Egyptian pounds.

The drop in state spending follows Cairo's June 25 announcement that it would not draw on a three-billion-dollar loan facility it secured with the International Monetary Fund, nor would it take up a World Bank offer of aid.

Source : New Age

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