Financial year 2019/2020 is expected to end with a budget deficit ranging between 7.8 percent and 7.9 percent because of the impact of the COVID-19 pandemic, said Minister of Finance Mohamed Maait on Tuesday. Maait's comments were made during a meeting of parliament's planning and budget committee held on Tuesday, Ahram Online reported. Reviewing the expected impacts of the COVID-19 outbreak on the financial year 2020/2021 draft budget, Maait revealed that the projected budget's surplus was lowered to 0.6 percent, down from the 2 percent that was expected in the financial year 2020/2021 draft budget statement released in April. He added that the financial year 2020/2021 draft budget expects the total budget deficit to rise to 7.8 percent in case the COVID-19 pandemic crisis lasts until the end of December, up from the targeted total deficit by 6.2 percent in the previous budget's statement. Maait also noted that the government has put a plan that targets reducing the total budget deficit to lower than 5 percent by the financial year 2021/2022, reaching 4.6 percent in the financial year 2021/2022 budget. Total state debt is expected to rise to 88 percent of GDP from a previously projected 83 percent if the crisis continues, the minister added. On Sunday, Minister of Planning and Economic Development Hala El-Saeed revealed that Egypt's economic growth is expected to fall to 4.5 percent and 4.2 percent respectively in the financial year 2019/2020, down from the 5.8 percent that was expected previously, driven by the expected slowdown in the third and fourth quarter of the fiscal year's performance. She also said that in case the COVID-19 crisis lasts to the end of December, Egypt's targeted economic growth is expected to drop to 2 percent, down from the 3.5 percent that is expected if the COVID-19 situation is over by the end of FY/2019/2020, which ends in June. Minister El-Saeed added that private investments are also expected to decline by 30 percent if the COVID-19 crisis lasts to the middle of the financial year 2020/2021, which will affect Egypt's total investments, which stand at 740 billion pounds in the financial year 2020/2021 draft budget.
