A newly formed committee will help reform the General Petroleum Authority's financial structure and find drastic solutions for its mounting debt problems, said a senior Finance Ministry official in a statement to Al-Masry Al-Youm on Thursday.
The official, who refused to disclose his name, expected the Finance Ministry committee to find solutions for the authority's problems, which include growing debt to other government bodies and the refusal of some banks to grant it additional loans after the authority exceeded credit limits.
The official stressed the need to modify the authority's finance structure so that banks will once again extend it credit. The committee will be headed by Deputy Finance Minister Momtaz al-Saeed
He expected the committee to announce the results of its meetings following Eid al-Adha.
However, Minister of Petroleum Abdullah Ghorab said the General Petroleum Authority's financial position is still strong and that it does not suffer severe financial problems. He added that all allocations granted to the authority are spent supporting petrol products on the market, which represent a major need for citizens.
Ghorab told Al-Masry Al-Youm that local and international financing institutions have no difficulty lending to the authority as a state-backed institution.
He also said the authority has fulfilled its obligations without any real problems.
The Central Auditing Authority confirmed in its final report on the authority for the fiscal year 2009/2010 that the authority continues to resort to external sources of funding to meet its financial obligations. The authority had received loans by the end of FY 2009/2010, on 30 June 2010, estimated at LE54.8 billion, a 41 percent increase from LE38.8 billion the previous year, according to the report.
Translated from the Arabic Edition