Arab Finance: The Egyptian cabinet has approved the country’s draft budget for the upcoming fiscal year (FY) 2024/2025 which begins on July 1st, according to a statement on March 27th.

As per the draft budget, Egypt targets a growth rate estimated at 4.2% for the new FY, with the primary surplus expected to hit over 3.5% of gross domestic product (GDP).

Minister of Finance Mohamed Maait revealed the draft budget will be presented to the House of Representatives on March 31^st. It includes the state’s general budget for administrative apparatus and economic bodies, bringing total government expenditures to EGP 6.4 trillion and revenues to EGP 5.05 trillion.

Also, Egypt aims to reduce the overall budget deficit in the medium term to 6% and put the debt-to-domestic product ratio on a downward path to reach 80% by June 2027, the minister said.

Maait pointed out that a cap worth EGP 1 trillion has been set for the total public investments of all the state's bodies in the upcoming FY, to make room for the participation of the private sector in the economy.

The minister added that Egypt eyes 36% growth in administrative apparatus revenues to hit EGP 2.6 trillion, with a 29% increase in its expenditures to reach EGP 3.9 trillion

Maait added that Egyptian President Abdel Fattah El-Sisi directed to increase the allocations for the health and education sectors by more than 30%, starting from the next FY.

El-Sisi also directed an increase in the allocations of subsidies, grants, and social benefits to reach EGP 636 billion, EGP 144 billion of which for subsidizing food commodities and EGP 154 billion for subsidizing petroleum products, in addition to EGP 215 billion for pensions and EGP 23 billion to support exports.

Furthermore, Egypt is targeting a 60% and 30% leap in non-tax revenues and tax revenues, respectively.

For her part, Minister of Planning and Economic Development Hala Elsaid noted that four sectors, including the agricultural, industrial, and real estate sectors, are expected to contribute about 51% to the GDP.

She added that the draft budget includes an increase in the share of private investments, to reach about 50% of the total investments, in line with the State Ownership Policy Document.

In addition, a significant portion has been earmarked for diverse sectors crucial for national development. Among the allocated funds, 42.4% are designated for investments in human development and 25.4% of the investment is allocated towards essential drinking water and sanitation projects.

Moreover, 8.4% of the investments are directed towards construction projects. Transportation and storage projects are also set to benefit, with 7.1% of the investment allocated to this sector.

Energy projects will receive 3.8% of the investments and 3.6% will be allocated to communications and information technology projects.

Furthermore, 3.1% of the investments are dedicated to agricultural projects, supporting the agricultural sector's growth and resilience.

Elsaid further revealed that 6.1% of the investments are designated for other government investments.

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