Finance Minister announced the Egyptian Samir Radwan, announced yesterday that his country would not need funding from World Bank and International Monetary Fund, despite an agreement with them, as it reviews the new budget reduced the projected deficit. He noted his adviser, Abdel Fattah al-Jabali, that the decision was «in response to pressure from the Egyptian public opinion, to avoid the burden of interest and loan installments».
The Cabinet approved the Egyptian in the first of June on the budget for fiscal year 2011-2012, which increased spending by a quarter to create jobs and help the poor after the popular revolution that overthrew President Hosni Mubarak after three decades in power. But the amended draft new budget announced Wednesday.
The Monetary Fund estimated deficit financing Egyptian external and fiscal, including nine billion and 12 billion for fiscal year 2011 to 2012.
Radwan told «Reuters» that the inability of 2011 - 2012 in the first draft of the budget was expected to reach 11 percent of GDP, but adjusted to 8.6 percent after a national debate and concern because of the junta about the debt levels. He said: «So we do not need to go at this stage to the Bank and Fund», adding that Egypt, which they borrowed from the IMF during the rule of Mubarak still has «the best of relations» with the two institutions.
In spite of the amended budget, the government still expects growth in the range of three to 3.5 percent, in line with previous forecasts, which analysts say may have been optimistic. Egypt was agreed this month to three billion dollars loan for 12 months from the IMF, asserting that the terms lighter than usual in such loans. And presentation of IMF and World Bank along with a number of countries and foreign institutions, to help Egypt to cover the large deficit in the budget after the turmoil that hit the economy in the wake of the protests that toppled the rule of Mubarak on 11 February.
Offered to Gulf states like Qatar and Saudi Arabia to provide support. Radwan said that Qatar had made $ 500 million to support the budget last week. He said «It is a gift» denying the existence of any conditions linked to funding the country. He said that Saudi Arabia has offered a similar amount before. The minister said that the first draft of the budget, which projected a deficit at 170 billion pounds (28 billion) were the subject of discussion with activists, writers, businessmen, trade unions and non-governmental organizations, and «a result of the dialogue in the light of the keenness of the military junta not to hold the government that will come after the election debt large, cut the deficit to 134 billion pounds, equivalent to 8.6 percent of GDP ».
He added: «This means that we do not need external financing. We will cover the bulk of local sources, even if we moved to the other in the package we need to (IMF) », stressing that the new budget will not back away from pledges to achieve social justice. He was needy, who demonstrated against Mubarak, demanding political freedoms and an end to what they see as a system of government in the interest of the wealthy elite at the expense of the poor.
In regard to the budget plans Radwan said that «our program so there are no conditions (of others). It is a different program, no more ». In response to a question whether Egypt will address the global markets by issuing bonds, a new foreign: «do not rule out anything. Immediately after adoption of the budget in the form of a final I will begin consideration of the details of the financing ».
The government expects in the latest budget has increased spending 14.7 percent to 490.6 billion pounds over 12 months starting in July, down from a previous estimate stood at 514.5 billion pounds when it announced a draft budget to the media in the first of June.
Radwan said that the budget cuts came partly by raising the income tax standard rate of 20 percent to 25 percent for companies and individuals who earn more than ten million pounds, with any profits above that figure will slide in the new tax. He explained: «consulted with business and said they are willing to pay, for this reason did not lift it to more than 25 percent if it has increased more than that, we will go back to before (years) when the income tax to 40 percent, and taxes are very few» . The cigarette tax will rise to 50 percent from 40 percent.
Radwan explained: «We started to open file support. We will not, I repeat, will not touch food subsidies or cooking fuel directed to the poor », adding that fuel subsidies would reduce the industry and others, stressing that the subsidy bill of about 137 billion pounds, of which about 99 billion pounds of fuel subsidies, but gave no time frame. He said the fuel subsidy bill will drop to 7.5 billion pounds. In an effort to help the industry adapt to change, he said that the government will help the factories to use natural gas instead of diesel fuel and raise support. He said that the additional revenue will be realized to check the export prices of gas, adding that he had already been agreed on the price adjustment with Jordan and Spain. Egypt exports gas to Israel as well. He also pointed to the need to obtain the approval of the Military Council on the draft of the new budget, but he ruled out any obstacles.
التسميات
Orbits