He added that the Egyptian economy is more resilient in the face of international challenges and has the ability to positively and flexibly cope with internal and external shocks thanks to the economic reform program.
“The Egyptian economy has been able to absorb the impacts of the coronavirus pandemic, and it will be able to absorb the negative impacts of the Russian-Ukrainian war and the unprecedented wave of inflation,” he said. he assures.
The Minister also said that the government is keen to achieve financial discipline and maintain the state’s safe economic course despite the current exceptional circumstances in various economies.
“The budget is expected to achieve an initial surplus of EGP 91 billion and reduce the total GDP deficit to 6.2% and the budget agencies debt ratio to 85% by the end of the current fiscal year. June,” the statement read. .
Maait added that the country’s financial performance over the past nine months has witnessed tangible significant performance over the previous year despite the significant increase in spending to meet all the needs of the state sectors.
“The annual growth in health expenditure has reached 24%. There has also been an increase in government investments, including the allocation of EGP 80 billion to the President’s Decent Life Initiative to develop the Egyptian countryside and EGP 16 billion for cash support under the Takaful and Karama Initiative with an annual growth rate of 23%, in addition to the payment of EGP 135 billion in contributions to pension and insurance funds, and food subsidy support of EGP 50 billion ‘EGP,’ the statement read.
Furthermore, the Minister said that the total deficit over the last nine months from July 2021 to March 2022 has decreased to 4.9% while maintaining a primary surplus and increasing tax revenue by 12.8% thanks to the implementation of a project to modernize and digitize the tax system. , which aims to integrate the informal economy into the formal economy, to better limit the tax pool and to collect royalties from the State’s public treasury.
Maait also said that the e-invoicing system has been successfully implemented, which will enable business-to-business business transactions to be tracked through the exchange of invoicing data in digital form, adding that the trial of the system has been completed. launched in April 2022 to follow up. on commercial transactions between financiers and consumers in real time throughout the country.
The minister’s statement comes after the US Federal Reserve (FED) decided on Wednesday to raise its benchmark interest rate by 0.5% – the biggest increase in two decades – in a bid to curb rising l ‘inflation.
The measure is expected to have major economic impacts on developing countries, such as Egypt, as well as the developed world.
The Central Bank of Egypt (CBE) is due to meet on Thursday May 19 to discuss the country’s interest rate future in light of the latest US decision, with experts expecting the CBE to rise the interest rate between 0.5% and 2 percent.
The Fed’s decision should put pressure on emerging countries, which will have to repay their debts and interest in dollars.
The rise in the value of the dollar in the wake of the Fed’s decision will also affect imports and increase the trade balance deficit.
In March, the FED raised interest rates by a quarter of a point.
A week later, the CBE raised the overnight deposit rate, overnight lending rate and main transaction rate by 1% (100 basis points) to 9.25%, 10 .25% and 9.75%, respectively.
In February, Egypt’s inflation rate hit its highest level in almost 30 months to surpass the original CBE inflation target of 7% (±2 percentage points) by the end of 2022.