Egypt’s reform program aims to achieve sustainable growth through 3 axes

CAIRO – 24 April 2019: Egypt’s economic reform program aims to achieve sustainable growth, return economic stability and create jobs through three axes to stabilize macroeconomic indicators and carry out structural reforms and integrated programs of social protection, Deputy Minister of Finance for Financial Policies Ahmed Kojak said.

Kojak pointed out that the Egyptian national economic reform program was supported by international institutions such as the International Monetary Fund by a loan of $12 billion to increase confidence in the program at the international financial institutions.

This came during his speech in a session entitled “The Challenges of Economic Reforms in the Arab Region” in the Arab Banking Conference in Beirut.

“The foreign reserves of Egypt reached unprecedented levels with balances of $44 billion, the highest level in its history, in addition to achieving a primary surplus in the state budget for the first time in a long time, along with the decline in the rate of inflation and unemployment,” he said.

Kojak noted that Egypt is targeting a growth rate of 6 percent in the new fiscal year 2019/2020, from a current growth rate of about 5.5 percent, which is the second highest growth rate in the region.

Over the past three years, efforts have been coordinated between the Egyptian government agencies and the Central Bank of Egypt (CBE) to ensure the success of the economic reform program and address the challenges of the exchange rate, unemployment, public debt and the deficit of the general budget, according to Kojak.

Earlier this month, Minister of Finance Mohamed Ma’it reviewed Egypt’s draft budget for new fiscal year 2019/2020 in the Parliament, stating that the draft budget aims to increase the growth rate to about 6 percent, at a cost of LE 6.163 trillion.

Ma’it added that the new budget focuses on the growth of containment and sustainability to result in reducing inflation to 10.5 percent and the unemployment rate to 9 percent.

In the beginning of April, the Ministry of Finance issued the 2019/2020 preliminary budget draft and the Parliament will receive the draft at least 90 days before the start of the fiscal year on July 1 to have it signed into law by the end of June.

Following the announcement of Egypt’s draft budget for 2019/2020, Moody’s Rating Agency said that Egypt’s budget for fiscal year 2019/2020 points to continued fiscal consolidation, describing it as credit positive. Moody’s expected Egypt to achieve a growth rate of 5.8 percent in 2019/2020.