Egypt to decrease budget deficit to 4.6% in 2023/24

CAIRO – 30 May 2021: Egypt’s Ministry of Finance targets to decrease the budget deficit to about 6.5 percent of the gross domestic product (GDP) in 2021/2022, to about 5.3 percent in 2022/2023, and 4.6 percent in 2023/2024, according to Minister Mohamed Maait.

These indicators come in the ministry’s plan to gradually improve the economic indicators in the economic indicators.

“Despite the repercussions of coronavirus locally and globally, the current estimates based on the actual performance of the first half of the fiscal year 2020/2021 indicate an expectation of achieving a primary surplus of about 0.6 percent of GDP,” Maait noted, adding that the Ministry aims to return the average of the primary surplus to its path as it was before the pandemic.

He added that the Ministry of Finance is working in accordance with the medium-term public debt management strategy, through which the government is committed to restoring the downward path of public debt and continuing efforts to contain and reduce financing needs in the medium term.

The Minister pointed out that to achieve the goals, the Ministry of Finance published a medium-term debt strategy that explains the methodology followed by the ministry to improve public debt management, and the ministry has also formulated a medium-term revenue strategy to ensure consistency and sustainability of efforts to develop public revenues, which included administrative and institutional reforms and procedures that ensure achieving financial and tax targets. The ministry is also working on restructuring expenditures to keep pace with the urgent needs and future plans of the state.

The Egyptian Minister of Finance also stated that the ministry aims to preserve the successes achieved in reducing the energy subsidy bill and directing the savings to priority areas, especially those related to improving citizens' conditions, human development programs and rural development.

Maait pointed out that the ministry aims to increase allocations for social spending, such as the "Takaful and Karama" program, health and education programs, as well as initiatives to support economic activity, especially the industrial sector and export activities.

He continued: The Ministry is working in cooperation with all concerned agencies to support the empowerment of women and youth with special needs in addition to enhancing financial inclusion, cashless payment, and green development efforts by offering green bonds, and approving green fees whose proceeds are used to finance the government's efforts and commitments regarding sustainable development.