Answer to Question #58416 in Finance for Nehal

Question

Did the tools that the Egyptian government uses to finance the deficit are efficient?

Answer 1

Deep cuts to fuel subsidies have allowed Egypt to sharply reduce its budget deficit. Including electricity and food, subsidies account for more than a quarter of Egyptian government spending. That's why Egypt’s budget deficit dropped 0.7 percentage points to 11.5 per cent of GDP. These tools seem to be efficient enough to finance the deficit.