Lebanon’s budget gap widens 60% y/y to USD 3.3bn at end-September 2013

By bne IntelliNews December 2, 2013

Lebanon's budget gap (including Treasury transactions) widened 60% y/y to LBP 5tn (USD 3.3bn) in the first nine months of the year on falling revenue (both tax and non-tax) and rising spending, mainly on salaries and debt servicing, the finance ministry said in a statement. The budget deficit will likely reach LBP 5.5tn by end-2013 and might expand further in 2014 if no measures were taken to boost revenue, according to caretaker finance minister Mohammed Safadi.

The deficit equalled 31.9% of total spending in January-September, up from 22.3% the previous year.

Total budget proceeds dropped 2.2% y/y to LBP 10.6tn, whereas spending rose 11.6% to LBP 15.6tn. The budget recorded a LBP 824bn primary deficit over the period compared with a LBP 978.6tn primary surplus the year before.

Tax proceeds fell 1.5% y/y to LBP 7.8tn mainly on lower VAT and custom fees. The latter shrank 3.5% y/y to LBP 1.62tn in January-September on falling energy imports. A weak tourism activity and related consumption have also weighed on VAT receipts that edged up just 0.1% y/y to LBP 2.48tn over the period.

Non-tax proceeds fell 10.8% y/y to LBP 2.2tn mainly on shrinking telecom receipts and subdued real estate deals. Telecom receipts shrank 15.2% to LBP 1.4tn in January-September.

Debt servicing rose 1.5% y/y to LBP 3.9tn over the period on higher interest payments on foreign debt (up 6.4% y/y to LBP 1.49tn). Interest on the domestic debt fell 1.3% y/y to LBP 2.44tn. Transfers to loss-making Electircite du Liban (EDL) dropped 3% y/y to LBP 2.54tn on lower fuel prices.

Related Articles

Ankara and Tehran join wave of anger directed at Trump’s recognition of Jerusalem as Israel’s capital

US President Donald Trump's December 6 announcement that his administration has decided to unilaterally recognise Jerusalem as Israel's capital was described as “against international law” by ... more

Islamic State is finished declares Iran's President Rouhani

Iranian President Hassan Rouhani on November 21 declared the end of the so-called Islamic State militant and terrorist group following decisive battles in Iraq and Syria. Stating that he wished to ... more

Turkey the loser as Baghdad rewards Iran with control of Kurdish oil exports

Iran is taking control of oil exports from Iraqi Kurdistan's giant Kirkuk field with Baghdad authorising the move as a reward for the Iranians' help in quelling the Kurds' late September push for ... more

Dismiss