CAIRO, Nov 24 (Reuters) - Egypt expects its budget deficit
to be 10.4 percent of gross domestic product in the financial
year ending June 2013, coming in below the 11 percent or so it
reached in 2011/12, a minister said on Saturday.
The figure of 10.4 percent is well above the 8 percent or so
originally forecast for 2012/13, but economists and government
officials had said the original estimate was optimistic as it
was based on austerity measures that have yet to be taken.
Planning and International Cooperation Minister Ashraf
al-Araby outlined the new 10.4 percent forecast for the deficit
this year at a news conference and repeated the government's
plan to rein the deficit in to 8.5 percent in 2013/14.
Egypt said it had agreed with the International Monetary
Fund to cut back the deficit in talks that ended this week in
Cairo and which that led to a preliminary deal for a $4.8
billion IMF loan to support the battered economy.
Egyptian officials had put the 2011/12 budget deficit at 11
percent. Prime Minister Hisham Kandil told Reuters this week it
was 10.8 percent and said Egypt would issue a supplementary
budget to amend the 2012/13 budget after any IMF deal.
Among measures planned are steps to curb spending on fuel
subsidies, which includes terminating subsidies on 95-octane
fuel, the highest grade available, and introducing quotas in
April for drivers to buy lower grades at subsidised prices.
Drivers currently pay well below real costs for their fuel,
which is a big drain on state coffers.
Araby also announced Egypt, a gas producer and exporter,
would start importing gas in the second quarter of 2013, running
April to June, a move that may help Egypt meet its own export
contracts while domestic demand rises.
Egypt said in October it had agreed to import Algerian gas
and was in talks with Qatar for a similar deal.
Egypt has two liquefied natural gas (LNG) plants and a
pipeline to export gas, but energy industry sources say the
government has been diverting some gas contracted for export to
the domestic market, which suffered fuel shortages and
electricity cuts in the summer.
(Reporting by Tamim Elyan; Writing by Edmund Blair, editing by
William Hardy)