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Four months after coup, Egypt's budget deficit reaches $18 billion

The Chairman of Al-Ahram newspaper, Mamdouh Al-Wali, has revealed that the government budget deficit has reached EGP 123 billion ($18 billion) during the period July to October 2013, the first four months after the coup. This, said the former head of the Press Syndicate, is despite the fact that the subsidy, investment, purchase of goods and government services budgets have been cut in comparison to the allocated amounts during the term in office of deposed President Mohamed Morsi.

Writing on his personal Facebook page, Al-Wali said, "The Ministry of Finance announced that the budget deficit reached EGP 73 billion during this four month period, with outgoings reaching EGP 155 billion and revenues only EGP 82 billion. This is the deficit that the ministry is declaring in the media." However, he pointed out that this deficit only takes into consideration six out of the eight expense categories, as the net spending on financial securities, which is the seventh expense category, reached EGP 1.596 billion. The eighth category is the repayment of domestic and foreign debts which has now reached EGP 48.490 billion, making the total budget deficit EGP 123.45 billion.

"The deficit has reached this amount even though no budget was allocated for petroleum products during these four months due to the petrol and crude oil donated to Egypt from Saudi Arabia, the UAE, and Kuwait." The cost of petrol in Morsi's first four months in office was over EGP 12 billion. "This gaping budget deficit occurred even after the reduced subsidy for food products, a decrease in budgets allocated for purchasing goods and services, as well as the budget allocated for investments in comparison to these budgets during President Morsi's term," added Al-Wali. He concluded by noting that the coup government has also received around EGP 7 billion in donations from Gulf States, whereas nothing was given to Morsi's government, and yet the deficit is still so huge.

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