Egypt's gov't indebtedness decreases 20.5% of GDP in 3 years: Min.

CAIRO – 28 April 2021: Government indebtedness decreased by 20.5 percent of the gross domestic product (GDP) over a period of 3 years, Minister of Finance Mohamed Maait said Wednesday.

Maait stated in a statement that the government indebtedness decreased from 108 percent of GDP in June 2017 to 87.5 percent in June 2020.

He added that government debt is expected to be 89 percent of GDP by the end of June 2021, as well as in the next fiscal year as well.

The minister pointed out that the prices of most goods and services have stabilized, bringing the annual inflation rate to 4.5 percent in March 2021, down from 23.3 percent in 2016, and about 22 percent in 2017, noting that the reserve balance of foreign exchange has increased significantly to exceed $ 40 billion last April to cover more than 7 months of the import bill for goods and services.

He also noted that the unemployment rate fell to about 7.2 percent in December 2020, down from 13.3 percent in 2013.

He pointed out that the Ministry of Finance is continuing to complete the procedures for reforming public finances, achieving fiscal control, and putting the overall deficit and public debt on a sustainable downward path through the implementation of reforms on the public spending side aimed at improving public financial management systems, rearranging public spending priorities and medium-term sustainability.

Maait explained that Egypt was able to reduce the budget deficit, which exceeded 12.5 percent of GDP in 2015-2016, to 7.9 percent in the year 2019-2020, and is expected to reach 7.7 percent by the end of this year, and 6.7 percent in the next fiscal year.

He continued, "The transformation of the primary balance from a deficit of 3.5 percent of GDP in 2015-2016 to a primary surplus of 1.8 percent of GDP in 2019-2020, and it is expected that it will reach 1 percent of GDP by the end of this year, and 1.5 percent in the next fiscal year.”