Egypt announced a historic primary surplus of LE 330 billion, with a 38.4% increase in tax revenues compared to the previous year. Spending in health and education rose 29% and 24%, respectively, while social benefits surged by 44%. The FY2025/2026 budget focuses on economic growth, job creation, and enhanced social support amidst ongoing debt management efforts and the successful implementation of IMF reforms.
In the period from July 2024 to February 2025, Egypt achieved a landmark primary surplus of approximately LE 330 billion as reported by Minister of Finance Ahmed Kouchouk. This notable financial accomplishment signifies the government’s focused efforts toward enhancing fiscal stability and boosting revenue generation.
Minister Kouchouk noted a year-on-year increase in tax revenues of 38.4 percent, which represents the highest annual growth rate in recent years. This revenue growth has allowed the government to enhance its spending in critical sectors, with health and education expenditures rising by 29 percent and 24 percent, respectively. Furthermore, there was a significant 44 percent increase in financial allocations for subsidies, grants, and social benefits aimed at supporting vulnerable communities.
The Minister also spoke about advancements in debt management, facilitated by a more effective distribution of interest payment obligations throughout the fiscal year. He pointed out that while the growth rate of treasury-funded investments has decelerated, this aligns with the government’s strategic intent to prioritize public spending sustainably, achieved by adjusting investment plans within the fiscal year’s expenditure limits.
Looking to the future, key priorities for the FY2025/2026 budget include stimulating economic growth and enhancing job creation. The government intends to inspire confidence in the Egyptian economy by promoting productive sectors and boosting tourism and technology industries. Maintaining financial and economic stability will remain paramount, with an emphasis on achieving fiscal goals, reducing debt, and securing energy resources while fulfilling commitments across various sectors.
Significantly, there will be increased funding for social protection and human development initiatives, including strengthening support for vulnerable populations through enhanced programs like Takaful and Karama, and other social welfare initiatives.
Furthermore, during the meeting, Minister Kouchouk updated attendees on Egypt’s IMF reform program, confirming the successful approval of the fourth tranche disbursement and outlining preparations for the fifth review. He also introduced a proposal aimed at reducing the debt burden on budgetary institutions as part of the government’s broader commitment to achieving fiscal sustainability and long-term economic resilience.
Overall, Egypt’s FY2025/2026 financial strategy seeks to balance economic growth, fiscal discipline, and expanded social support, ensuring continued development while maintaining economic stability.
In summary, Egypt has successfully recorded its highest-ever primary surplus of LE 330 billion and realized substantial growth in tax revenues. The increase in spending on essential sectors such as health and education, alongside enhanced social welfare programs, reflects a strong commitment to supporting vulnerable communities. The government’s approach prioritizes economic growth, fiscal sustainability, and social support to secure long-term stability and resilience within the Egyptian economy.
Original Source: www.egypttoday.com
