Allocations for health and education will increase by 30 percent in FY2024/25
President Abdel-Fattah El-Sisi directed the government on Tuesday to maintain financial discipline and ensure the financial sustainability of the state’s general budget, in addition to taking all the necessary measures to reduce the public budget debt and its service debt burdens.
El-Sisi's directives came during his meeting with Prime Minister Mostafa Madbouly, Minister of Finance Mohamed Maait, and Deputy Minister of Finance for Fiscal Policies Ahmed Kouchouk.
According to Fahmy, the meeting reviewed the draft budget for the fiscal year (FY) 2024/25 where Maait presented the key final indicators of the draft budget.
The budget, which is based on achieving a growth rate of four percent of the gross domestic product (GDP), aims to achieve an initial surplus of 3.5 percent and the reduction of the total deficit in the medium term to six percent of the GDP.
This is in addition to the growth of revenues in the state’s general budget by almost 36 percent to reach EGP 2.6 trillion ($54.4 billion) and the growth of public expenditures of the state’s general budget by 29 percent to amount to EGP 3.9 trillion ($85.5 billion).
Furthermore, EGP 575 billion ($12 billion) will be allocated for wages and EGP 636 billion ($13.3 billion) for subsidies, grants, and social benefits, including EGP 144 billion ($3 billion) for basic food supplies and EGP 154 billion ($3.2 billion) to subsidize petroleum products.
Additionally, over EGP 40 billion ($836.5 million) will be allocated for the Takaful and Karama social protection programme, and allocations for health and education will increase by 30 percent.
During the meeting, Maait noted that – for the first time this year – the concept of the general government budget will be introduced in a way that helps highlight the true capabilities of the state’s public finance according to an objective reading that reflects the entire revenues and expenditures of the state and its public bodies.
He further added that the general government budget will be presented in FY2024/25, including the state's general budget and the budgets of 40 economic bodies, as a first phase, bringing the total revenues of the general government budget to EGP 4 trillion ($83.6 billion), while the total expenditures amount to EGP 4.9 trillion ($102.5 billion).
Last week, Maait said the state is placing a stringent ceiling of EGP 1 trillion ($20.9 billion)on public investments in the upcoming FY2024/25, while also capping public debt.
The purpose of the new investment ceiling is to create more opportunities for the private sector, stated Maait, emphasizing that all investment projects undertaken by state-owned entities will be subject to this limit.
Egypt has recently achieved significant foreign currency inflows, including a mega $35 billion deal signed with the United Arab Emirates in February for the development of the Ras El-Hekma area on the North Coast.