Al-Sisi approves budget that reduces subsidies and raises prices

A statement by the Egyptian ministry of finance on Sunday said that the recently inaugurated president Abdel-Fattah Al-Sisi has approved a revised budget for the fiscal year 2014-2015.

The new budget reduces deficit to 10 percent of GDP, compared to 12 percent in the previous budget.

According to government sources who spoke with Al-Araby Al-Jadid newspaper, decreasing budget deficit was done through reductions in subsidies of fuel, commodity and services. This, in turn, would lead to price hikes across different sectors.

The ministry of finance’s statement added that the total expenses in the new budget amounted to 789 billion pounds, while general revenues reached 549 billion, recording a total deficit of 240 billion pounds. This is equivalent to 10 percent of the GDP, compared to a projected deficit of 234 billion pounds in the current fiscal year 2013-2014, namely 12 percent of GDP.

The new budget includes the implementation of essential economic and social measures that aim at stimulating the economy and overcoming its structural problems.

The minister of finance, Hany Damian, is scheduled to hold a press conference on Monday to provide further details on the new budget and the reforms it includes.