Finance Minister says Egypt’s economic situation “reassuring”

Finance Minister Ahmed Kouchouk affirmed Friday 20/9/2024 that Egypt’s economic situation is “reassuring” as reflected in positive budget performance indicators during the past fiscal year.

“We are striving to contribute effectively to establishing a “business-friendly” environment that relies on a sufficient degree of trust, clarity, and tax certainty, essential for building investment plans for new projects within a long-term framework of trust and positive partnership between the Egyptian Tax Authority (ETA) and the local and foreign business community,” the minister said during a series of meetings with over 100 representatives of major financial institutions and investment and development banks in London.

“We achieved a 6.1 percent primary surplus, including returns from Ras Al-Hikma, and reduced the budget deficit to 3.6 percent of GDP. The domestic debt of the budget decreased by 4.7 percent, and external debt fell by more than 4 percent, with an average maturity of 12.7 years,” Kouchouk said.

He explained that the goal is to maintain annual primary surpluses to bring the debt-to-GDP ratio below 85 percent by the end of the next fiscal year.

The minister added that the Egyptian economy will become more stable with the growth of the private sector and the expansion of its role in investment and development activities, given the government’s tangible efforts to create more space for private investments. This includes capping public investments and continuing the government’s privatization program under the State Ownership Policy Document.

He also highlighted the promotion of competitive neutrality by eliminating preferential tax treatments for state-owned companies and entities, improving infrastructure, and offering attractive incentives for local production and exports. Additionally, he pointed out the competitive opportunities in globally and regionally prioritized sectors, the simplification of procedures, and access to the “golden license.”

The minister emphasized the ongoing work to develop the government securities market to attract new investors and reduce financing costs by diversifying sources, tools, markets, currencies, and investor segments.

Egypt is cooperating with the International Monetary Fund (IMF) in a comprehensive program aimed at enhancing the performance of the Egyptian economy, he added.

He stressed the importance of managing macroeconomic risks with a more cautious outlook, while benefiting from global expertise in addressing international and regional challenges. He expressed his anticipation of a larger role by multilateral banks in supporting the growth and development of emerging economies.

The finance minister participated in several roundtable discussions with institutional investors interested in government securities markets worldwide, organized by HSBC, Morgan Stanley, and Jeffries Bank.

He also met with representatives of the European Bank for Reconstruction and Development (EBRD) to discuss ways to enhance mutual cooperation, empower the private sector, and the critical role it will play in Egypt’s economy in the coming period.