Egypt achieved a primary budget surplus of 6.1 percent in the fiscal year 2023/24, driven by a landmark sale of coastal land to the UAE, revealed the country’s finance minister.
At a press conference, Ahmed Kouchouk disclosed that Egypt’s total expenditure amounted to EGP3.016 trillion ($61.25 billion), with a budget deficit of 3.6 percent.
Largest foreign investment in Egypt’s history
In February 2024, the UAE, through a consortium led by Abu Dhabi’s sovereign wealth fund ADQ, signed an agreement to invest $35 billion in Ras El-Hekma, a Mediterranean region 350 km northwest of Cairo. This deal represents the largest foreign direct investment in Egypt’s history.
No new taxes, but increased tax revenues
The minister highlighted that no new taxes were levied last year, yet tax revenues increased by 30 percent year-on-year for the financial year 2023/24. This aligns with the International Monetary Fund’s objective for Egypt to boost tax revenue in its 2025/26 budget.
Prioritizing citizen services
“The priority is to enhance services for citizens as much as possible, and we will work tirelessly to ensure a better future,” Kouchouk said. “The Egyptian people are the true owners of the budget, and we will strive to maximize resources to create sufficient financial space for spending on human development and matters of importance to citizens,” he added.
Translating budget improvements into economic performance
Despite the improvements in budget numbers, the minister acknowledged that they would be ineffective unless they translate into better economic performance, enhanced business competitiveness, and an improved standard of living. “The challenges are difficult for the people, the economy, and the government, and the state is trying to bear the greatest burden,” he said.
Increased spending on social sectors
Kouchouk also noted a 25 percent increase in spending on education, 24 percent on health, and 20 percent on social protection. Allocations for support and social protection have more than doubled since 2020/21 to reach EGP550 billion.
“We will rearrange our priorities again so that public spending is more socially conscious to mitigate the impact of economic reforms,” the minister added.
Declining public investments vs increased private investments
Kouchouk acknowledged a decline in public investments but said, “We are working hard to increase the volume of private investments with a focus on investments directed to industry and export, and we still need more work to enhance the private sector’s contributions to economic activity.”
Positive economic reforms and indicators
In April 2024, then-Finance Minister Mohamed Maait noted that Egypt’s economic reforms, aimed at empowering the private sector and attracting investment, had begun to yield positive results despite global and regional economic challenges. Financial indicators had surpassed budget estimates and targets over the previous nine months of the fiscal year 2023/2024.
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