Lebanon’s budget gap narrows 31% y/y to $2.4bn in January-October 2014

By bne IntelliNews February 5, 2015

Rising revenue and falling spending cut Lebanon’s budget deficit by 30.7% y/y to LBP3.68tn ($2.4bn) in the first ten months of 2014, data from the finance ministry showed. The narrowing budget gap will help the government cut the worrying debt-to-GDP ratio that is forecast to reach144% of GDP in 2014, according to S&P.

Lebanon’s gross pubic debt grew 5.3% y/y to $66.6bn at end-November 2014.

Rising LBP-denominated domestic debt, as local banks remain the main subscribers to the Treasury issuances, continues to boost Lebanon’s gross public debt.

Earlier this week, the government mandated Lebanon’s Societe Generale Bank, Blom Bank and Citi to arrange a $1bn 7-to-10-year bond issue to help finance the budget needs, daily Assafir reported on Thursday February 5.

The government also recently adopted a minimum salary hike for the public sector after almost two years of debate and political bickering. The government also adopted some partial tax hikes including raising the VAT to 11% from the current 10% to boost budget revenue.

The deficit equalled to 21.6% of total spending at end-October, down from 30.8% a year earlier. Improving fiscal balance, and excluding debt servicing, also helped the state budget achieve a LBP1.696tn primary surplus at end-October, reversing a LBP473bn primary deficit a year earlier.

Total budget revenue grew 11.5% y/y to LBP13.3tn at end-October whereas total spending fell 1.5% y/y to LBP16.99tn.

Tax proceeds rose 3.6% y/y to LBP9.2tn at end-October, accounting for 69.2% of total revenue. Lower imports during the period cut customs proceeds by 5% y/y to LBP1.71tn while VAT receipts grew 1.3% y/y at LBP2.97tn.

Non-tax proceeds climbed 11.8% y/y to LBP2.7tn lifted by rising telecoms revenue, up 5.5% y/y to LBP1.61tn.

Lower fuel costs also cut spending on the loss-making Electricite du Liban by 9.3% y/y to LBP2.46tn at end-October.

Related Articles

Turkish Airlines' share price falls further after UK follows US with electronics flight ban

The share price of Turkish Airlines (THY) was down 2.88% by the end of trading on March 21 after the UK joined the US in banning electronic devices larger than smartphones in hand luggage on flights ... more

Turkish Airlines' share price slides after US bans electronic devices on flights

Flag carrier Turkish Airlines (THY) saw its share price fall 1.69% on March 21 after confirming it is among the nine airlines affected by a US cabin baggage ban on large electronic devices on flights ... more

Iran, Syria sign raft of memoranda and deals

Following the purge of foreign-backed rebels in the devastated Syrian city of Aleppo by Iranian, Lebanese and Russian forces, Damascus’s prime minister Imad Khamis was in Tehran to sign five ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss