Egypt Approves FY2025/2026 Draft Budget

The Egyptian Cabinet has approved the draft state budget for fiscal year 2025/2026 and agreed to refer it to the House of Representatives for parliamentary review. The proposed budget reflects the government's continued efforts to strike a balance between expanding social support and maintaining fiscal responsibility.

During the cabinet meeting, Minister of Finance Ahmed Kouchouk outlined the key features of the new budget. Projected revenues are expected to reach LE 3.1 trillion, marking an annual growth rate of 19 percent, while total expenditures are forecast at LE 4.6 trillion, an 18 percent increase compared to the previous year. The government also aims to achieve a primary surplus of LE 795 billion, equivalent to 4 percent of GDP, and reduce the debt-to-GDP ratio for general budget entities to 82.9 percent.

The budget meets the constitutional spending requirements on education, health, and scientific research, with LE 679.1 billion allocated to public sector wages, reflecting an 18.1 percent annual increase to cover salary adjustments effective July 1, 2025.

The healthcare sector receives a significant funding boost, with LE 22 billion allocated for medicines, LE 12.4 billion for raw materials, LE 11 billion for medical supplies, LE 2.8 billion for equipment maintenance, and LE 5 billion for therapeutic drugs and baby formula. The budget also designates LE 15.1 billion to cover medical treatment for uninsured low-income citizens, and LE 5.9 billion for health insurance targeting students, women who are primary caregivers, and children under the comprehensive health insurance scheme.

To ease the financial burden on vulnerable groups, the government has allocated LE 732.6 billion for subsidies, grants, and social benefits, a 15.2 percent increase over the previous year. This includes LE 160 billion to support food subsidy programs like bread and ration cards, reflecting a 20 percent annual growth. The “Takaful and Karama” social protection program will see a 35 percent budget increase, bringing total allocations to LE 54 billion, with monthly cash assistance set to rise by 25 percent beginning April 2025.

Energy subsidies remain a major component, with LE 75 billion allocated for petroleum support and an additional LE 75 billion for electricity subsidies. Another LE 3.5 billion will be used to connect households to natural gas networks.