Target missed EGYPT will be unable to meet its goal of lowering its budget deficit annually by one per cent of GDP during fiscal year 2008/2009. Minister of Finance Youssef Boutros Ghali said earlier this week that the budget deficit will remain at its current level of 6.9 per cent due to the projected increase in spending aimed at shielding against inflated prices of food and fuel. Ghali added that had it not been for the economic reforms and the subsequent growth rates that enabled the government to hedge against soaring prices, the deficit would have shot up to over the expected LE70 billion through 2008/2009. Preliminary figures for the fiscal year starting in June show a substantial 35 per cent increase in expenditures to LE330 billion. This covers a 49 per cent increase in subsidies, grants and social benefits rising to LE128 billion, including hikes in fuel subsidies, due to higher international prices. Wages and salaries for public employees are set to rise 22 per cent to LE73 billion. The government is currently facing a daunting situation now that inflation is expected to increase in 2008/2009 as the international cost of food remains high and following the government's decision in early March to raise the price of fertilisers by 90 per cent. Rapid economic growth in the past three years, especially in construction and manufacturing, and the government's phasing out of some energy subsidies, is adding to inflationary pressure. Tides of change UN SECRETARY-General Ban Ki-Moon raised the alarm on World Water Day, 22 March, calling on everyone across the globe to work on preserving increasingly depleting water resources. According to Ban, at least 2.5 billion people in the world live in the most abysmal standards of hygiene and sanitation. "Every 20 seconds, a child dies from diseases associated with a lack of clean water," he said. "That adds up to an unconscionable 1.5 million young lives cut short each year." As a step in the right direction, the UN is working on organising a top level summit in New York next September to address these issues and decide on how to reach some significant goals, particularly in Africa. Unlike oil, there are no substitutes for water. Naturally, the problem escalates as fresh water resources are stretched thin, populations increase, the climate changes and the global economy grows. "When you look at the health and development challenges faced by the poorest of the world's population -- diseases like malaria or TB, rising food prices, environmental degradation -- the common denominator often turns out to be water," stated Ban. UN calculations have identified 46 countries, home to 2.7 billion people, where climate change and water- related crises create a high risk of violent conflict. A further 56 countries, representing another 1.2 billion people, are at high risk of political instability. "That's more than half the world," he pointed out. Meanwhile, more areas around the world are becoming water stressed. For example, over the past 30 years, Lake Chad in Central Africa -- which supports some 30 million people -- has shrunk to one-tenth of its former size. This is a result of drought, climate change, mismanagement and over-use, noted Ban. In North America, the Colorado River seldom reaches the sea, and water stress affects one- third of the United States and one-fifth of Spain. "This is not an issue of rich or poor, north or south," argued Ban. "China is diverting hundreds of millions of cubic metres of water to drought-prone Beijing ahead of the Olympics, but shortages are expected to persist for years to come." Gloomy as it may be, some encouraging signs are apparent, especially on the part of the private sector. Companies worth $0.5 trillion gathered early last month in New York and committed to engaging with the UN, governments and civil groups to protect water resources. They are members of the UN Global Compact, the world's largest voluntary corporate citizenship initiative. "A drop in the bucket, yes," asserted Ban. "But, I see it as the first wave in a tide of change." New head for NBE IN A MOVE which surprised members of the banking sector, the Deputy Governor of the Central Bank of Egypt (CBE) Tareq Amer was appointed head of the National Bank of Egypt (NBE) for three years. Amer replaces outgoing Chairman Hussein Abdel-Aziz. NBE has LE162 billion in deposits, which is a 20 per cent stake of all banking sector deposits, and is the largest lender with extended loans of LE89 billion. The sector did not expect Amer to leave CBE since he was seen as heir apparent to CBE Governor Farouk El-Okda. Moreover, Amer's name was not high on the list on the nominees to head Egypt's largest bank. The list included names both inside and outside the NBE. During his five-year tenure as CBE's deputy governor, Amer was deeply involved in running the bank, managing monetary policies, restructuring the sector, as well as overseeing Egypt's foreign reserves portfolio. Before moving to CBE, Amer was deputy chairman of Banque Misr and had a long banking career in Citibank, Egyptian American Bank, Bank of America and the National Commerce and Credit Bank. School revamped AS PART of what it describes as its corporate social responsibility, the Suez Cement Group, a consortium of Suez Cement Company, the Helwan Cement Company and Tourah Portland Cement Company, allocated LE4 million to upgrade 10 schools in some of the country's most deprived areas. Last month, Cement Kafr Al-Elw primary school was inaugurated after undergoing a facelift. The new building which conforms with health conditions, accommodates 750 pupils. A green corner was allocated for daily activities and competitions are being held among schools in the neighbourhood to raise awareness of social issues such as illiteracy, children's rights and health. The initiative was taken in partnership between the Suez Cement Group, Cairo governorate and the National Council for Childhood and Motherhood to improve living standards in designated areas.
