Lebanon’s Fiscal Deficit Down by 44% YOY to $648.07M by February 2021

According to Ministry of Finance (MoF) latest figures, Lebanon’s fiscal deficit (cash basis) stood at $648.07M by February 2021, up from last year’s $1,157.28M.

In detail, the substantial deficit is attributed to the annual 23.42% drop in government revenues (including treasuries) which fell to $1,287.35M by February 2021. On the counterpart, total expenditures (including treasuries) retreated yearly by 31.81% to $1,935.41M by February 2021. It is worth noting that the primary balance which excludes debt service posted a deficit of $469.69M, compared to a deficit of $492.63M during the same period last year.

Fiscal revenues recorded a yearly drop by 25.17% to stand at $1,181.03M. Tax revenues (constituting 89.65% of total revenues) retreated by an annual 31.88% to $904.60M by February 2021. Revenues from VAT (21.49% of total tax receipts) dropped by 9.76% y-o-y to $250.90M. The drop in “VAT revenues” is most probably attributed to the deterioration of Lebanese purchasing power with the decrease in value of Lebanese pound, which obligated Lebanese people to rationalize their spending.

As for Non-tax revenues (10.35% of total revenues), they increased from $250.25M by February 2020 to $276.43M by February 2021. Meanwhile, “Telecom revenues” dropped yearly by 100%.

On the expenditures’ side, transfers to Electricity du Liban (EDL) (2.7% of general expenditure) slid by 62.67% to reach $72.78M. Moreover, total debt servicing (including the interest payments and principal repayment) reached $358.11M by February 2021, down by a yearly 42.21% such that interest payments alone retreated by 42.45% y-o-y to $343.27M. In details, interest payments on domestic debt slumped by 29.93% y-o-y to $338.15M. Meanwhile, interest payments on foreign debt registered a year-on-year significant drop by 95.50% to $5.12M.

In its turn, the treasury transactions (includes revenues and spending that are of temporary nature) posted a surplus of $179.73M compared to a deficit $44.97M by February 2020.

Yearly Fiscal deficit by February (in $M)

Lebanon’s Fiscal Deficit Down by 44% YOY to $648.07M by February 2021


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