The ministry of finance issued a financial monthly bulletin in December 2018 mentioning that the ministry is moving through with the reform process through establishing the first Administrative Training Centre to reinforce capacity building for all the employees in the ministry which will eventually increase the quality of its performance.
Another unit has been established under the name ‘Fiscal Transparency and Citizen Engagement’ that specialises in making all data publicly available in a concrete, comprehensible, and timely manner through publishing several fiscal reports which cover the entire budget preparation process.
Moreover, the ministry mentioned that to raise the internal monitoring competence, it announced earlier that a new ‘Internal Monitoring Unit’ has been formed to ensure that all the ministry’s tasks undergo a monitoring process. The institutional reform plan also includes the enhancement of the tax and customs services, which will be completed by the end of June 2020.
Furthermore, the ministry added that the GDP increased by 5.2% during the fiscal year (FY) 2017/18, compared to 3.6% during the last FY. Net Export performance was the highlight, contributing positively to growth by 1.8 percentage points (PPT), compared to a negative contribution of 1.4 PPT during FY 2016/17.
Meanwhile, public and private consumption have contributed to growth by a total contribution of 1.1 PPT, compared to 3.7 PPT during FY 2016/17. Investments contributed positively to growth by 2.4 PPT, compared to a lower contribution of 1.8 PPT during FY 2016/17.
Additionally, the ministry of finance mentioned that the total production index rose by 7.5% on annual basis recording an average of 130.2 points during FY 2017/18, compared to 121.1 points during FY 2016/17, driven mainly by the tourism sub-index which hiked by 65.8% on annual basis, recording an average of 102.7 points during FY 2017/18, compared to 62 points during FY 2016/17, and the natural gas sub-index that picked-up by 13.1% on annual basis, recording an average of 172.4 points during FY 2017/18, compared to 152.4 points during FY 2016/17.
Moreover, net international reserves showed enormous improvement, inching up to a record-high $44.501bn during November 2018 (covering 8.5 months of imports), compared to the same amount last month, and compared to a lowest level of $13.4bn at end of March 2013 (covering 3.5 months of imports).
The bulletin reads “Fiscal Performance during the period July-November 2018/2019 is one of the promising signals of economic reform success”. Adding that the budget deficit decreased to record 3.1% of the GDP during the period July-November 2018/19, compared to 3.7% during the same period last year. Additionally, this could be explained in light of the increase in revenues by 27.1% during the study period, exceeding the growth in expenditure recording 16.7%. On the revenues side it increased by EGP 47bn to record EGP 250bn during the period of study.
Moreover, the ministry of finance mentioned that the total government debt (domestic and external) increased to EGP 4315bn at end of June 2018 compared to EGP 3748.7bn at end of June 2017. However, total government debt decreased by around 10% of the GDP as a result of fiscal consolidation and efforts to decrease debt levels over the medium term. Meanwhile, government external debt increased as loans increased to $33.4bn end of June 2018, compared to $25.9bn at end of June 2017. Meanwhile, monetary authorities debt decreased to $26.6bn at the end of June 2018, compared to $30.3bn last FY.
The bulletin read “The Balance of Payments (BOP) ran an overall surplus, thanks to accelerating tourism, and workers’ remittances”. Furthermore, the BOP has registered a surplus of $12.79bn during the FY 2017/18, compared to a surplus of $13.72bn in the FY 2016/17, spurred by the decline in current account deficit, which recorded $-6bn in the FY 2017/18, compared to $-14.4bn in the last FY 2016/17.
Over and above, the ministry of finance mentioned when comparing in the report that the average annual inflation rate recorded since the beginning of current FY it has reached 15.4% during July-October 2018/19, declining notably by almost half compared to 31.8% recorded during the same period of last year.