Egypt targets primary surplus of 3.5% of GDP in FY2024/25

Updated 6/4/2024 12:20:00 PM

Arab Finance: Egypt is targeting achieving a primary surplus of EGP 591.4 billion, representing 3.5% of the gross domestic product (GDP), in fiscal year (FY) 2024/2025, Minister of Finance Mohamed Maait stated.

This is compared to an anticipated primary surplus of 5.75% of GDP, amounting to EGP 805.1 billion, by the end of the current FY.

Moreover, public expenditures under the coming FY’s budget have risen by 29% year on year (YoY) to EGP 3.87 trillion, accounting for 22.6% of GDP, Maait noted.

The minister also said that the government anticipates the overall budget deficit to hit around EGP 1.2 trillion, representing 7.3% of GDP, in FY 2024/2025. This is an expected budget deficit of EGP 555 billion, amounting to 4% of GDP, this FY.

In addition, state revenues are projected to hit EGP 2.6 trillion in the new budget, up by 8.5% from this FY’s expectations, he added.

Moreover, the country targets an increase of around 30.5% YoY in tax revenues to reach over EGP 2 trillion in the upcoming FY, while targeting non-tax revenues of EGP 599.6 billion, the minister mentioned.

Maait noted that the government allocated EGP 496 billion for the health sector, EGP 565 billion for pre-university education, EGP 293 billion for higher education, and EGP 140.1 billion for scientific research under FY 2024/2025 budget.

Additionally, wage allocations for FY 2024/25 surged to EGP 575 billion, versus expected allocations of EGP 494 billion for this FY, according to Maait.

The country has also dedicated EGP 635.9 for subsidies, grants, and social protection in the coming FY’s budget, 19.3% up from estimations of EGP 532.8 billion for this FY, he said.

Furthermore, EGP 154.5 billion was allotted for fuel subsidies, EGP 134.2 billion for subsidized food commodities, and EGP 40 billion for Takaful and Karama program and social insurance pensions, he added.

Also, the government dedicated EGP 11.9 billion to support social housing in FY 2024/25, EGP 3.5 billion to deliver natural gas to households, EGP 18.4 billion for medical insurance and treatment at the country’s expense, and EGP 2.4 billion for the universal health insurance scheme, Maait said.

The new budget also earmarks EGP 23 billion for refunding export burdens, EGP 6 billion to cut electricity costs for the industrial sector, and EGP 8 billion for the initiative supporting interest rates in credit facilities for production activities, he continued.

This is along with the allocation of EGP 1.5 billion as incentives to back the medium, small, and micro-sized enterprises and EGP 500 million to support the car manufacturing strategy, the minister pointed out.