Egypt to raise investments 64% in 2018/19

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Wed, 04 Jul 2018 - 08:56 GMT

FILE - Minister of Planning Hala el-Saeed

FILE - Minister of Planning Hala el-Saeed

CAIRO – 4 July 2018: The Egyptian government has pushed up investments by 64 percent during the current fiscal year 2018/2019, as a proactive step to counter the effects of the economic reform, Planning Minister Hala el Saeed said.

The minister noted, on the sidelines of the Government Excellence Conference, that this increase in investments is unprecedented and aims at providing job offers because the real support and real social protection of citizens is to create jobs.

“All sectors are witnessing a 50-60 percent increase in investments, and the local development investments in governorates are being doubled, rising by 80 percent during the current fiscal year,” the minister added.

She clarified that the local development affects the citizen directly through paving roads and covering the canals and the delivery of water and electricity and all essential services to citizens.

According to Saeed, the latest reforms taken by the government wouldn’t affect the economic growth rates even with a slightly decreased consumption rate, as there is an increase in the rates of investment and net exports.

On June 12, Egypt cut its electricity subsidies, raising prices by an average of 26 percent in the 2018-2019 fiscal year beginning in July.

Minister of Electricity Mohamed Shaker stated the overall increase does not exceed 26 percent, while the average hikes in bills for households amount to around 24 percent, affirming that the new hikes save the country from potential losses that might reach LE 109 billion.

Moreover, the Cabinet announced on June 16 cutting the fuel subsidies, to support the energy by only 25 percent now.

The new prices are Gasoline 95 prices went up from LE 6.6 ($ 0.37) per liter to LE 7.7, while 92 octane gasoline prices amounted to LE 6.75 instead of LE 5 per liter. Prices of gasoline 80's liter increased to LE 5.5 instead of LE 3.65, the newly-appointed government said in its first move since taking oath.

The price of diesel will be LE 5.5 a liter instead of LE 3.65, while the price of natural gas used for vehicles rose to LE 2.75 per cubic meter instead of LE 2.

The government also announced raising the price of the cooking gas cylinder to LE 50 instead of LE 30 and the commercial gas cylinder's prices surged to LE 100 instead of LE 60.

The minister further affirmed that the expected growth rate of the fourth quarter of fiscal year 2017/2018 is 5.5 percent, adding that the growth rate of the whole fiscal year would reach 5.3 percent.

In June, The World Bank lifted its expectations of Egypt’s gross domestic product (GDP) to record 5.3 in 2017/2018.

Saeed previously said that Egypt recorded a gross domestic product (GDP) of 5.4 percent during the third quarter of fiscal year 2017/2018.

Egypt had embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT), and cutting energy subsidies, all with the aim of trimming the budget deficit.

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