Egypt increases social spending to mitigate global economic crisis impact

CAIRO - 30 May 2024: In response to global economic crises, the Egyptian government has allocated more than half of its expected state revenues in the new budget to social spending. This prioritizes social protection and human development, particularly in healthcare and education.

 

The Egyptian government is taking significant steps to shield its citizens. In a major budgetary shift, more than half of the expected state revenues, amounting to LE 2.99 trillion, are being directed toward social spending programs for the upcoming fiscal year. 

 

 

Expanded safety net: Recognizing the increased vulnerability of low-income families, the government is bolstering the "Takaful and Karama" program. This crucial initiative provides cash support to those most in need. Allocations for Takaful and Karama are scheduled to increase to LE 240 billion, with an estimated 27 million citizens benefitting from 2024-2030. 

 

Subsidies for essentials: To directly address the impact of global food price hikes, the budget allocates LE 134.2 billion to support food commodities. This ensures Egyptians continue to have access to essential food items at affordable prices. Additionally, a 29.4 percent increase in petroleum product subsidies, bringing the total to LE 119.4 billion, aims to ease the burden of transportation costs, impacting daily commutes and the movement of goods.

 

 

 

Investing in healthcare: Recognizing the importance of health during economic hardship, the budget prioritizes healthcare spending. A 24.7 percent increase allocates LE 10.1 billion for government-funded medical care. This investment will translate to improved access to essential medical services for a wider range of citizens. Furthermore, increased funding has been allocated for various health initiatives: LE 5 billion for medicines and infant formula, representing a 66.7 percent annual growth rate and LE 3.3 billion to support health insurance programs for various segments of society, including students, women with breadwinners, children under school age, those in need, and Social Security pensioners

 

Engaging civil society organizations: The government is fostering partnerships to strengthen the social safety net. A noteworthy development is the establishment of the National Alliance for Civil Action Development, with a membership of thirty-six entities and institutions from government agencies and civil society organizations. This alliance brings together government agencies and NGOs, fostering collaboration and leveraging the expertise of both sectors. This united front aims to deliver more effective social protection initiatives for the benefit of Egyptians.