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EGYPT-GDP-DEBT
Egypt to reduce public debt to 92 pct of GDP in FY 2018-19: minister
CAIRO, Aug. 12, 2018 (BSS/Xinhua) – Egyptian Finance Minister Mohamed
Ma’it said the country will reduce its public debt to 92 percent of the GDP
in the budget of the current fiscal year 2018-2019, state-run Ahram newspaper
reported on Saturday.
“The government has enforced package of procedures to reduce the public
debt to 92 percent of the GDP compared with 98 percent in the previous year,”
the report said.
The new financial measures intended to increase the state’s public
revenues and control the government’s expenditures, the minister said.
He added also that the financial performance would be improved after new
laws on tariffs and taxes take into effect soon.
The government’s plans for diversifying the state revenue resource will
add 10 billion pounds (56 million U.S. dollars) to the country’s treasury.
According to Waleed Gab-Allah, professor of financial and economic
jurisdictions at Cairo University, “Egypt’s economy owns the workforce and
the resources but lacks funds, which forced the government to borrow.”
To compensate for the debt, the government had to reduce its dependence on
loans, and increase its revenues, Gab-Allah told Xinhua.
Part of the country’s economic reforms that started at the end of 2016,
was using part of the surplus of some governmental private funds as public
budget instead of carrying it forward to the coming fiscal years balance.
The revenues of that surplus be used for creating more jobs along with the
country’s other assets, the expert added.
Gab-Allah expected success for the Finance Ministry’s new measures, but
believed its application is also associated with the world’s fluctuating
economy.
He added some economic ups and downs, like the increase in the world oil
prices last year, had negative impacts on the government plans.
Central Bank of Egypt (CBE) said on Monday that Egypt’s foreign debt has
risen to 88.2 billion dollars at the end of March, with total public debt
accounting for 86 percent of the GDP.
Egypt has been facing difficult economic conditions due to political
instability and relevant security challenges over the past few years.
To boost economy, the Egyptian government started in late 2016 a strict
three-year economic reform program based on austerity measures, fuel and
energy subsidy cuts and tax hikes.
In addition to floating local currency’s exchange rate, the reform plan
has been encouraged by a 12-billion-dollar loan from the International
Monetary Fund, two thirds of which has already been delivered to the most
populous Arab country.
BSS/AFP/HR/1150