Economist says Egypt's debt servicing bill exceeds 50% of public spending
She added that the Finance Ministry's announcement of a primary surplus of 3.1 percent of GDP from the July 2024-April 2025 period strongly indicates improved public financial management, and provides greater confidence in the government's ability to adhere to the path of economic reform.
This surplus, the highest in Egypt's history, is equivalent to nearly LE600 billion and comes at a highly sensitive time, as the global economy is experiencing inflationary pressures and a decline in capital flows to emerging markets.
Tahoun explained that this achievement was made despite a decline in revenues from some vital sectors, such as the Suez Canal and the petroleum sector, while Suez Canal revenues declined by approximately 40 percent during the first quarter of 2025.
This reflects the effectiveness of fiscal policies in compensating for the loss by improving tax collection efficiency and controlling public spending, she explained.
Tahoun said that this surplus supports the state's ability to finance basic expenditures without the need to borrow to finance the current deficit, contributing to reducing pressure on public debt.
While praising the results, Tahoun emphasized that 'achieving a primary surplus is a positive step, but the most important thing is to continue achieving it sustainably.'
The government must strike a delicate balance between achieving fiscal discipline and stimulating economic growth, she said, especially since the current growth rate—estimated at between 3.5 and four percent—is still below long-term targets.
Tahoun concluded by saying that the focus during the next phase should be on deepening local production, attracting foreign direct investment, and expanding the social protection umbrella to ensure that positive indicators are reflected in improved quality of life, not just overall indicators.
Edited translation from Al-Masry Al-Youm
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Daily News Egypt
35 minutes ago
- Daily News Egypt
Egypt's Al-Mashat holds bilateral talks on sidelines of G20 meeting
Egyptian Minister of Planning, Economic Development and International Cooperation, Rania Al-Mashat, has held a series of bilateral meetings with international officials on the sidelines of the G20 Development Ministerial Meeting in South Africa. The discussions focused on the outcomes of the G20 meeting and the recent Seville conference on financing for development, as well as the future of bilateral economic relations in light of Egypt's national priorities, the ministry said in a statement. Al-Mashat met with delegations from France, Canada, Singapore, Spain, Japan, South Korea, and Portugal, as well as the heads of several international organizations, including the World Food Programme (WFP), the Organisation for Economic Co-operation and Development (OECD), the International Fund for Agricultural Development (IFAD), and the United Nations Industrial Development Organization (UNIDO). During the meetings, the minister discussed the need to restructure the global financial system to overcome development financing challenges, especially in developing and emerging economies. With French Minister of State, Thani Mohamed Soilihi, Al-Mashat discussed the significant progress in bilateral relations, particularly following the elevation of ties with the EU to a strategic partnership. They touched on French investments in Egypt and development cooperation in sectors like transport, energy, and education. In a meeting with Canada's Minister of International Development, Randeep Sarai, Al-Mashat expressed her desire to strengthen cooperation, especially in economic empowerment, climate action, and human development. She noted the previous successful collaboration with now-Prime Minister Mark Carney through Egypt's NWFE programme. Al-Mashat and Singapore's Senior Minister of State, Sim Ann, discussed enhancing cooperation in trade, education, and culture, building on over 60 years of diplomatic relations. The minister also met with the director of the Spanish Agency for International Development Cooperation, Antón Leis Garcia, to discuss increasing development cooperation in line with global financial system reforms. Talks with Japan's Parliamentary Vice-Minister for Foreign Affairs, Hisashi Matsumoto, focused on expanding ties, including financing more projects and increasing funding for the private sector in Egypt. Al-Mashat praised Japan's role in supporting Egypt's development, including recent funding for private sector empowerment and the development of the Cairo Opera House. With South Korea's Deputy Minister for Multilateral and Global Affairs, Kwoun Ki-hwan, Al-Mashat discussed the strategic development cooperation partnership, which has financed numerous projects. She expressed her hope to expand relations to include more areas of investment and technology exchange. Al-Mashat and Portugal's Secretary of State for Foreign Affairs and Cooperation, Ana Isabel Xavier, discussed expanding cooperation to increase investment in priority sectors like industry, renewable energy, and information technology. The minister also met with the heads of several international organisations. With WFP Executive Director Cindy McCain, she discussed joint efforts to enhance food security through the programme's 2023-2028 country strategy for Egypt. They also reviewed the WFP's participation in Egypt's debt-swap initiatives. In her meeting with OECD Deputy Secretary-General Mary Beth Goodman, Al-Mashat discussed the progress of the OECD's country programme for Egypt, which focuses on inclusive economic growth, innovation, governance, statistics, and sustainable development. Discussions with IFAD President Alvaro Lario covered the partnership to support agricultural and rural development and mobilise international partners for food projects under the NWFE platform. Finally, Al-Mashat met with UNIDO's Director for Gender Equality and Women's Empowerment, Cecilia Ugaz Estrada, to discuss joint efforts to enhance the competitiveness of Egypt's industrial sector.
Egypt Independent
6 hours ago
- Egypt Independent
Egypt's government plans to borrow from citizens through retail bonds
Economic expert Mohamed Fouad, the head of the al-Adl Center for Public Policy Studies, commented on the announcement by Finance Minister Ahmed Kouchouk of the issuance of retail bonds for individuals to help them find new savings methods. Kouchouk has said that the government is considering launching Egyptian pound-denominated sukuk and bonds for individuals during the current fiscal year. These instruments 'will provide additional liquidity through the new notes and provide a new savings mechanism for citizens,' he noted. Fouad said via his X account that 'The idea is excellent. The government is borrowing from savings, since the majority of banks' investments are in government debt instruments.' 'Citizens are accustomed to certificates (of deposits), while investing in debt instruments is limited to companies and higher-income individuals. The outcome of the proposal will be higher returns for individuals and less funding for the government. Win-win, not in vain.' Retail bonds are a government debt instrument aimed at financing the state's general budget. These bonds are available to individuals and institutions and feature a specific maturity period and a periodic return known as a coupon. Edited translation from Al-Masry Al-Youm
Daily News Egypt
2 days ago
- Daily News Egypt
Egypt's FM delivers Al-Sisi message to Niger's leader, seeks deeper security ties
Egyptian Foreign Minister Badr Abdelatty met with Niger's leader, General Abdourahamane Tchiani, in Niamey on Wednesday and delivered a written message from President Abdel Fattah al-Sisi aimed at strengthening security and economic ties, Egypt's foreign ministry said. In a statement, the ministry said Abdelatty's visit came as part of a push to enhance cooperation, with the minister conveying Sisi's greetings and stressing that the trip was aimed at supporting Niger based on the historical ties between the two nations. Abdelatty highlighted the strategic importance of Niger's stability for Egypt's national security, describing the Sahel region as a 'natural extension of Egypt's strategic neighbourhood.' He said that growing terrorist threats and the spread of armed groups across the continent necessitated enhanced security cooperation and the exchange of expertise between Egypt and Niger. The talks also focused on expanding economic partnerships. The foreign minister noted that he was accompanied by a high-level delegation of 30 Egyptian business leaders to participate in the first Egyptian-Nigerien Business Forum. The forum aims to boost economic, trade, and investment cooperation, particularly in the energy, infrastructure, construction, and mining sectors. The statement said the discussions covered existing cooperation in combating terrorism and extremist ideology. Abdelatty highlighted the role of Cairo-based institutions, including Al-Azhar, which provides training for Nigerian imams and scholarships for students, as well as the Cairo International Center for Conflict Resolution and the Egyptian Agency for Partnership for Development (EAPD), which offer capacity-building programmes for Nigerian personnel. For his part, President Tchiani asked Abdelatty to convey his greetings and appreciation to President Sisi, expressing his country's gratitude for Egypt's support in facing its security and development challenges. He also praised Egypt's leading regional and international role and the support provided by Al-Azhar in religious education. The two officials also discussed regional issues, including developments in the Sahel and West Africa and the security challenges posed by the spread of terrorist organisations.
