Egypt strives to lower public debt ratio to 80% by mid-2027: minister

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Egypt - Finance Minister Mohamed Maait has announced the commencement of a pivotal phase in Egypt’s development and construction journey under President Abdel Fattah Al-Sisi.

The goal is to reinforce the New Republic’s framework, aligning with the Egyptian populace’s aspirations and their pursuit of a respectable existence.

The strategy is designed to serve all citizens impartially, with explicit, well-defined priorities that sketch out the national action plan for the forthcoming era.

This approach aims to bolster stability, economic and social advancement, and the judicious employment of human capital via all-encompassing, coordinated structural reform strategies.

These strategies are set to instigate fiscal discipline, thereby freeing up fiscal capacity to augment social investments, focusing on pivotal groups and the most deprived regions, particularly amidst the global economic turmoil.

During the introduction of the Procedural Guide for Gender-Responsive Budgeting aimed at fostering Equal Opportunities and Gender Equality, Maait highlighted that Egypt’s recent economic reforms are pivotal to securing stability and fostering economic growth.

These reforms are integrated into the overarching state budget, which harbours ambitious objectives such as achieving a primary surplus of 3.5% of GDP, curtailing the overall deficit to 6% over the medium term, and diminishing the debt ratio to 80% by June 2027.

A critical aspect of these reforms is the establishment of an upper limit on the government’s debt across all economic, service, administrative, and local sectors, a threshold that can only be surpassed during national crises or urgent situations with consent from the President, the Cabinet, and the House of Representatives.

The reforms also entail a more than 30% increase in funding for healthcare and education, alongside augmented allocations for support and social protection to mitigate the inflationary pressures on the citizenry.

The Finance Minister underscored the growing focus of the political leadership on nurturing, supporting, and empowering women, children, individuals with disabilities, the youth, and seniors.

This commitment has significantly contributed to bridging gender disparities, promoting equal opportunities and gender equality, and furthering social equity in a more enduring manner. It also fosters a culture of constructive engagement in the nation-building process, underscoring the significance of recent legislative changes to the Unified General Budget Law.

These amendments reinforce the budget’s unity and inclusivity across all public economic, service, administrative bodies, and local authorities. They also enhance the efficacy of public expenditure and bolster targeted initiatives aimed at improving the livelihoods of citizens across various social, age, and geographic demographics, thereby impacting poverty reduction and laying the groundwork for holistic and enduring development.

Maait elucidated that the recent modifications to the Unified General Budget Law reiterate the government’s pledge to incrementally adopt the “Program and Performance” budgeting model over six years. This will be achieved by refining functional and administrative frameworks and oversight mechanisms, ensuring the optimal use of state assets, and fulfilling the objectives of the national economic and social development blueprint, as well as the country’s strategic goals.

He affirmed that gender-responsive budgeting is a cornerstone of the “Program and Performance” budget, resonating with Egypt’s Vision 2030. It ensures the precise execution of governmental programs and initiatives through equitable and more focused methods to lessen gender disparities.

Furthermore, he noted that the formulation, groundwork, and execution of the state’s general budget for the fiscal year 2024/2025 are being carried out with due consideration for the requisite financial provisions.

These provisions aim to refine the targeting of gender-responsive budgets and achieve gender parity through more adaptable and precise mechanisms. This effort is supported by the release of the Procedural Guide for Gender-Responsive Budgeting for Equal Opportunities and Gender Equality Programs, which stands as a sophisticated reference work encapsulating its tenets, notions, and methodologies throughout the budget’s preparation, planning, execution, monitoring, and assessment phases.

This guide is instrumental in accurately identifying the needs of each demographic in the creation of the program and performance budget for all state entities.

Deputy Minister for Financial Policies and Institutional Development, Ahmed Kouchouk, acknowledged the collaborative efforts of various ministries and authorities in producing the guide, alongside the National Council for Women and the UN Entity for Gender Equality and the Empowerment of Women in Egypt. These efforts are part of a concerted push towards gender equality and equal opportunities.

Kouchouk noted that crafting the general state budget and government programs is a complex task, balancing fiscal discipline with developmental goals that demand substantial investment. This necessitates improved governance of the financial system and prudent public expenditure to ensure equitable resource distribution and social justice.

UN Entity representative Christine Arab commended the Ministry of Finance for developing the National Procedural Guide for Gender-Responsive Budgeting, highlighting its significance as a regional benchmark, particularly its availability in Arabic.

National Council for Women President Maya Morsi remarked that the guide aligns with the Egyptian state’s initiatives to optimize public spending, lower poverty, and meet financial and economic objectives amid structural reforms and increased funding for programs enhancing Egyptian women’s quality of life.

Dalia Fouad, Director-General of Monitoring and Evaluation and head of the Human Rights and Gender Equality Unit at the Ministry of Finance, described the guide as a comprehensive resource for stakeholders. It details the principles, goals, and methodologies of gender-responsive budgeting, referencing international practices. The guide also outlines how to incorporate gender equality into all budgetary phases, supporting the Sustainable Development Goals, Egypt Vision 2030, the National Strategy for Empowering Egyptian Women, and the National Strategy for Human Rights. The Ministry of Finance commits to periodic updates of this guide to ensure its relevance and efficacy.