The Ministry of Finance is about to prepare the State Budget for the fiscal year 2009-2010, as a prelude to refer it to the People's Assembly (parliament) late next March. Speaking to Al-Masry Al-Youm, head of the ministry's general budget Hassan Munir said the ministry is studying effects of the world decline in oil and food prices on the state's budget, especially with regard to more than LE60-billion appropriations for subsidizing oil products and food commodities. Such effects will appear in the next fiscal year's budget.
Local oil prices would not decline as the world ones because the differential between the cost and the price of sale is great. However, the decline in world oil prices would reduce the subsidy to oil. The subsidy to supply goods and wheat depends on the decline in world prices of basic commodities, including food and wheat, of which 50% is imported while and the other 50% are bough from the Egyptian farmers for the world prices, Munir said, referring to the possibility of amending these prices by the bodies concerned.
The next budget will take into account all internal and external financial and economic impacts, including wage increases for doctors and teachers and an allowance for workers, 30% of the basic salary, which undoubtedly affected, according to him, the per capita income. As for the LE13.3-billion package of measures to refresh the national economy, Munir said such measures would be funded through loans and the securities, including treasury bills. The Ministry of Finance has no intention to issue coins to finance such measures because this will increase inflation.
Such measures will be taken in the remaining six months of this fiscal year, Munir said, ruling out an increase in expenditure of more than LE15 billion.
