Minister of Finance Mohamed Maait at Egypt's Economic Conference
CAIRO - 24 October 2022: Egypt plans to lower the budget deficit during the next five years to reach 4 percent by 2026/2027, according to Minister of Finance Mohamed Maait.
Maait elaborated that Egypt’s budget deficit recorded its highest rate during the period between 1980 to 1985, reaching 13.8 percent, before it started to decline to range from 4.4 percent to 6 percent.
The Minister of Finance added, during his speech at the Economic Conference, that the budget deficit index began to decline from 2015/2016, and reached the lowest rate in 42 years.
As per the debt, Maait, said that the lowest debt rate witnessed by Egypt hit 78.7 percent, while the highest debt reached by Egypt was 159 percent, explaining that the current period is witnessing a rise in inflation rates with a rise in interest rates.
The Minister of Finance added that pensions currently receive 35 percent of the subsidies, explaining that food commodities allocate 35 percent of the total allocations for subsidies.
The minister expected a decrease in the volume of subsidies during the next five years to 72 percent of the size of the debt, as It will be the lowest level of debt Egypt has known in more than 42 years.
According to Maait, the general government debt approved by international institutions is 85.2 percent in Egypt, and the state aims to reduce the size of the debt to 72 percent in the fiscal year 2026-2027.
The Minister of Finance explained that tax revenues represent three quarters of the Egyptian state’s revenues.
“The percentage of subsidies directed to energy decreased from 69 percent to 7 percent,” he pointed out.
He noted that tax revenues represent a large part of state revenues, elaborating that there is a positive correlation between the increase in public revenues and the increase of taxes.
“The state's public debt is an important item in the Egyptian economy, and the state is working on this matter through a clear plan,” he stated, saying that the state is working on a medium revenue strategy, and on increasing the tax revenue, by integrating the informal economy, in addition to improving the business and investment environment.
The Egyptian Economic Conference 2022 kicked off on Sunday at Al-Massa Hotel in the New Administrative Capital to discuss the situation and future of Egypt’s economy amid consecutive economic crises across the world.
The Economic Conference, which runs from 23 to 25 October, is organized by the government with the directives of President Abdel Fattah El-Sisi and the participation of a large number of economic experts and intellectuals.
The conference agenda is packed with many sessions and events over its three days, according to three main tracks. The first track includes macroeconomic policies, while the second track focuses on empowering the private sector and creating a business environment.