By Sara Aggour, Mohamed Ayyad, and Abdel Qader Ramadan
President Abdel Fattah Al-Sisi said in a speech Tuesday he has yet to approve the state budget’s current draft for 2014/2015 which will push the budget deficit up and increase the debt to over EGP 2tn.
Speaking at the graduation ceremony of the military academy, Al-Sisi added: “The debt will be pushed from EGP 1.7tn to over EGP2tn.”
“I met with the Prime Minister, the Minister of Finance and the Minister of Planning, along with some other Egyptian ministers to discuss the 2014/2015 draft for state budget,” Al-Sisi said, adding the “some adjustments and revisions need to be made”.
Al-Sisi said that should the deficit keep increasing, “no heritage will be left for the coming generations”.
He stated that Egypt survived the past 10 months with the help of “our brothers”, referring to GCC assistance to Egypt in loans, grants and petroleum products.
“We are embarrassing ourselves and embarrassing the people,” Al-Sisi said, adding that the challenges and problems need to be faced with sacrifices made by every Egyptian.
Following Al-Sisi’s speech, the government will hold a session Wednesday to hear proposals from ministers on budget development, said Sherif Shawky, media adviser to the Prime Minister.
With all articles still “under review”, the majority of the discussions will revolve around the state budget and how to fix it. The draft for the 2014/2015 state budget was referred to the presidency on 26 May, the first day of elections. Significant changes in public spending, health, education, electricity and petroleum product subsidies and expectations for investment have been made to the new draft.
According to the draft budget, the public spending increased by EGP 65bn, around 10% compared to the current year’s budget, to register EGP 807bn.
Petroleum subsidies have been cut to EGP 104bn, compared to last year’s EGP 134.429bn – an approximate EGP 30bn decrease..
Target revenues are EGP 517bn, less than the revenues expected for collection during the current fiscal year.
Governor of the Central Bank Hisham Ramez announced Monday the opening of a new bank account under the number 037037, a reference to the date on which President Abdel Fattah Al-Sisi declared the ouster of former president Mohamed Morsi.