Egypt’s Budget Surplus Soars to $18 Billion Despite Economic Shocks
In a remarkable turn of events, Egypt’s budget has recorded a preliminary surplus of 875 billion Egyptian pounds ($18.14 billion) for the fiscal year 2023/2024, a significant increase from the previous period’s surplus of 164 billion. This announcement was made by Minister of Finance Ahmed Kouchouk during a Cabinet meeting chaired by Prime Minister Mostafa Madbouly.
Economic Challenges Overcome
Despite facing economic activity shocks, Egypt managed to achieve this surplus, showcasing resilience in the face of adversity. The country’s economy has been affected by crises in Gaza, impacting tourism growth and Suez Canal revenue, crucial sources of foreign currency for Egypt.
Government Actions to Combat Inflation
To combat inflationary pressures on the Egyptian public, the government increased funding in the 2024/2025 budget by over 2.8 trillion pounds ($59 billion) in April. This move aimed to alleviate the burden on citizens and stimulate economic growth.
Revenue Growth and Deficit Reduction
Minister Kouchouk highlighted that revenues saw an annual growth of approximately 59.3 percent during the fiscal year 2023/2024. Additionally, the budget achieved a total deficit that was 706 billion pounds lower than originally projected, showcasing effective financial management.
Sectoral Allocations and Expenditure Growth
Despite overall deficit reduction, certain sectors exceeded their allocated budgets. Education, health, Insurance and Pensions Fund dues, and food subsidy support all required additional funding. This, alongside wage increases and social protection programs, contributed to an expenditure growth rate of 37.4 percent.
Future Budget Plans and Debt Reduction
Looking ahead, the Ministry of Finance aims to reduce the budget’s debt and put it on a downward trajectory for the fiscal year 2024/2025. Efforts are underway to improve expenditure structure and reduce the debt service bill.
Financial Resilience Amidst Challenges
Despite facing regional geopolitical unrest, high inflation rates, and social programs to protect citizens, Minister Kouchouk emphasized the ministry’s strong financial performance. By mobilizing revenues and controlling public finances, Egypt has demonstrated its ability to navigate challenges and achieve financial stability.