Egypt’s Budget Deficit Falls to 5.1 Percent of GDP Amid Strong Revenue Growth

Egypt’s Ministry of Finance announced a notable decline in the country’s overall budget deficit over the first eight months of the 2024–2025 fiscal year, covering July through February.

The Ministry reported that the deficit reached LE 879.3 billion, equivalent to 5.1 percent of GDP, down from LE 898 billion, or 6.5 percent of GDP, during the same period last year. In its latest report, the Ministry highlighted a strong increase in the primary surplus, which grew by around LE 137 billion to record LE 330 billion, representing 1.9 percent of GDP, compared to LE 193 billion, or 1.4 percent of GDP, in the previous year.

This improvement is largely attributed to a 38.4 percent surge in tax revenues, reflecting a broad-based increase across all tax categories. The growth was fueled by a recovery in economic activity, the resolution of the foreign exchange crisis, and the ongoing digitalization of tax administration systems, which expanded the tax base and strengthened revenue collection.

The Ministry emphasized that public spending was kept under control during this period, supported by improved debt management practices that better distributed interest payments across the fiscal year. It also cited efforts to diversify financing sources, reduce dependence on the unified treasury account, adhere to legal spending limits, and contain public investment spending within the ceiling of LE 1 trillion set for the current fiscal year.

Additionally, total public revenues rose by 32.8 percent, or LE 356.4 billion, reaching LE 1.442 trillion during the eight-month period, compared to LE 1.086 trillion a year earlier. Tax revenues contributed approximately 85.6 percent of total revenues, while non-tax revenues made up about 14.4 percent.

At the same time, public expenditures increased by LE 314.9 billion, or 15.8 percent, reaching LE 2.308 trillion compared to LE 1.993 trillion during the same period in the previous fiscal year.