Egypt one of best int'l markets in bond investment return: Min.

CAIRO – 5 September 2019: Egypt is considered, with international certificates, one of the best markets in the world in terms of the return on investment of sovereign bonds, and regarding the increasing interest of foreign investors to buy government debt instruments after the success of the economic reform program, Finance Minister Mohamed Ma’it said.

Ma’it referred during the Canada- Egypt business council to the state’s keenness to extend the life of debt by an average of 4 years during the fiscal year 2019/2020.

He pointed out that the government succeeded in reducing the ratio of government debt to GDP from 108 percent at the end of June 2017, to 90.5 percent at the end June 2019, and it is targeted to reach 82.5 percent in 2020, and 77.5 percent in 2022.

The minister noted that the government adopted an international strategy to achieve a lower debt ratio, primary surplus of 2 percent, and high growth rates.

Meanwhile, Ma’it pointed out that the state is keen on achieving human development by focusing on health and education, taking into account the social dimension and strengthening protectionist measures for citizens.

“Some 82.6 percent of the financial allocations planned for support in the 2019/2020 budget were allocated to social protection programs, up from 50 percent in the 2014/15 budget, where energy subsidies (petroleum and electricity) were rationalized,” he stated.

Ma’it added that within the framework of the government's keenness to ease the citizens' burdens, the subsidy on the supply of goods during the past 5 years has increased from LE 39.4 billion in the 2014/15 budget to LE 89 billion in the current budget. “Takaful and Karama, and social security pension rose from LE 6.7 billion to LE 18.5 billion, and contributions of pension funds hiked from LE 33.2 billion to LE 82.2 billion.”

He stressed that the value of subscription of the new Suez Canal certificates amounts to LE 64 billion and are now available at the Central Bank.

Furthermore, Ma’it stressed that over the next 7 years, LE 1.336 trillion will be paid to social insurance funds, in light of the Social Insurance and Pensions Law No. 148 of 2019, which ends financial entanglements to allow the recovery of pensioners' funds.
He pointed out that the state treasury will continue to support pension funds with a total sum of LE 45 trillion over the next 50 years.

The minister said that an agreement was made with the Ministry of Social Solidarity on the rules and procedures of payment until the end of the current fiscal year on June 30, 2020.

“By the end of the fiscal year, LE 160.5 billion will be transferred from the State Treasury to social insurance funds.”

As per exports, the finance minister said that stimulating exports is a national security issue, clarifying that exports contribute to increasing the state's ability to attract foreign currencies, boost growth, create new jobs, and maximize domestic production. “Therefore, the government is keen to overcome obstacles facing exporters and intervene to solve their problems.”

The minister pointed out that the provisions allocated to stimulate exports have been increased by LE 2 billion from the budget of last year to LE 6 billion this year.