How COVID-19 widened Egypt’s budget gap

Ahmed Elleithy

Mask-clad EgyptAir crew (safety measure due to the COVID-19 coronavirus pandemic) check the documents of travellers preparing to board an Airbus A320neo aircraft on the tarmac at Sharm el-Sheikh International Airport, in the Red Sea resort city at the southern tip of the Sinai peninsula on June 20, 2020. (Photo by Khaled DESOUKI / AFP) (Photo by KHALED DESOUKI/AFP via Getty Images) — Mask-clad EgyptAir crew check the documents of travelers preparing to board an aircraft on the tarmac at Sharm el-Sheikh International Airport, in the Red Sea resort city, Sinai Peninsula, Egypt, on June 20, 2020. — KHALED DESOUKI/AFP via Getty Images

The coronavirus pandemic has deepened Egypt’s state budget deficit to 6.5% of the gross domestic product (GDP) in the first 11 months of fiscal year 2020, which ended on June 30 — up from 6.2% of GDP for the same period a year earlier.

The deficit in the state budget was 389.1 billion Egyptian pounds ($24.3 billion) at the end of May, the Ministry of Finance said in a statement.

Revenue from the Suez Canal plunged 5.9% in the first 11 months of fiscal 2020 to 56.91 billion pounds ($3.56 billion), down from 60.5 billion pounds ($3.78 billion), another Finance Ministry statement said.

The state’s revenue from taxes fell to 601.4 billion pounds ($37.6 billion) from July 2019 to May 2020, compared to 616.4 billion pounds ($38.57 billion) in the same period a year earlier.

How COVID-19 widened Egypt’s budget gap

The coronavirus outbreak and the subsequent lockdown measures have largely affected Egypt’s budget deficit.

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