According to Ministry of Finance (MoF) latest figures, Lebanon’s fiscal balance (cash basis) decreased by 153.79% from last year to register a surplus of $1,457.27M by December 2021 for the 7h month in a row reflecting the extent contractionary policy taken by the State that is characterized by decreased government spending and also increased taxes revenues. And it was the first in the post-war period.
In more details, the government revenues (including treasuries) added 32.08% on yearly basis to stand at $13,441.32M by December 2021. On the counterpart, total expenditures (including treasuries) retreated yearly by 7% to $11,984.05M by December 2021. It is worth noting that the primary balance which excludes debt service posted a surplus of $3,658.24, compared to a deficit of $255.63M during the same period last year.
Fiscal revenues recorded a yearly increase by 37.39% to stand at $12,472M. Tax revenues (constituting 82.11% of total revenues) added an annual 45.47% to $10,107.27M by December 2021. Revenues from VAT (24.6% of total tax receipts) added 157.99% y-o-y to $3,190.21.
As for Non-tax revenues (16.28% of total revenues), they increased from $2,130.11M by December 2020 to $2,364.73M by December 2021. Meanwhile, “Telecom revenues” added annually 2.53% to stand at $1033.81M by the same period.
On the expenditures’ side, transfers to Electricity du Liban (EDL) (8% of general expenditure) decreased by 41.88% to reach $537.27M. Moreover, total debt servicing (including the interest payments and principal repayment) reached $1,865.74M by December 2021, down by a yearly 9.45% such that interest payments alone retreated by 10.59% y-o-y to 1,730.05M. In details, interest payments on domestic debt increased by 5.34% y-o-y to $1,685.27M. Meanwhile, interest payments on foreign debt registered a year-on-year significant drop by 71.06% to $44.78M.
In its turn, the treasury transactions (includes revenues and spending that are of temporary nature) posted a deficit of $335.23 by December 2021 compared to last year’s deficit of $392.88M.
Yearly Fiscal deficit by December 2021 (in $M)
Source: MoF, BLOMINVEST