The minister said that the implementation of the structural reform program is a top priority for the government. To improve the business climate, increase local and foreign private sector investments in all fields, especially in development projects such as infrastructure, education and health, in addition to improving the competitiveness of Egyptian products, and maximizing the proceeds of Egyptian non-oil exports in a way that contributes to improving the trade balance and building a strong industrial base.
The minister added that the economic and financial reforms implemented during the past years have given the Egyptian economy a sufficient degree of flexibility that contributed to providing a strong and diversified domestic financing base and a high foreign exchange reserve balance, in a way that helped finance our needs in both local and foreign currencies despite the continuing “Corona” crisis and its negative repercussions. on the global economy.
The minister explained that the Egyptian economy recorded a positive growth rate of 3.3% during the last fiscal year, and Fitch expects to continue achieving strong growth rates in the medium term, reaching 5.5% by 2022/2023, in light of the recovery of tourism and aviation, especially in light of the return of tourism. Russian, English and Italian to the Red Sea region, and an increase in the contribution of several other sectors such as the technology and communications sector, health and government services, pointing out that the achieved economic growth was supported by balanced economic and financial policies during the past years, as the primary surplus in the public budget was maintained through savings on expense side.
The minister indicated that the Fitch report expects the debt-to-GDP ratio to drop to about 86% by next June, and to achieve a primary surplus close to 1.5% of GDP during the current fiscal year, and 2% of GDP in the medium term. Supported by the continued implementation of an efficient debt management strategy over the medium term, which contributes to reducing the financing needs of the public budget to less than 30% of GDP; This is reflected in reducing the cost of debt service, in addition to the continuation of the implementation of the revenue strategy in the medium term, which aims to increase tax revenues by 2% of GDP by the end of 2024, through continued improvement of tax administration and expansion of the implementation of automation and electronic tax collection projects.
Ahmed Kjok, Deputy Minister for Financial Policies and Institutional Development, said that the balanced fiscal policy has led to enhancing the ability of the Egyptian economy to achieve strong financial indicators represented in achieving a primary surplus of 1.45% of GDP, which is one of the largest surpluses of the first balance achieved by emerging countries during the year. Previous, reducing the total deficit to about 7.4% of GDP, compared to 8% in the fiscal year 2019/2020, explaining that the strong performance of public financial indicators reflects the improvement and recovery of economic performance; As a result of the proactive methodology in dealing with the pandemic, a package of stimulus and preventive financial measures has been allocated about 2% of GDP to support the economic sectors and the most affected groups.
He pointed out that the adopted financial reforms and policies have contributed to reducing the debt service bill from 10% of the GDP during the fiscal year 2018/2019 to 8.8%, extending the debt life and maintaining investment returns in government securities, which contributed to reducing the total needs. The financing of the budget and its devices, pointing out that Egypt’s accession to the “J. with me. Morgan” by the end of next January, will support, according to the expectations of “Fitch”, the injection of new additional investments into the Egyptian government securities market, including treasury bills and bonds, increasing liquidity levels and enhancing the demand for Egyptian government debt instruments, thus reducing their cost.
He explained that Fitch experts expected the government’s ability to continue efforts to reduce the budget deficit during the fiscal year 2021/2022 to 6.7% of GDP and the continuation of achieving a primary surplus of about 1.5% of GDP. The measures taken by the government to maintain financial goals, such as re-rationing spending, increasing allocations to the health and education sectors, the “Solidarity and Karama” program, which provides cash transfers to the neediest groups, and increasing budgetary export support allocations. The report also positively addressed the measures taken by the government to expand the tax base through The application of the “electronic invoice”, which helped reduce tax avoidance and evasion, and expand the tax base.
These were the details of the news Finance: Fixing Egypt’s credit rating at B+ for the third time... for this day. We hope that we have succeeded by giving you the full details and information. To follow all our news, you can subscribe to the alerts system or to one of our different systems to provide you with all that is new.
It is also worth noting that the original news has been published and is available at eg24.news and the editorial team at AlKhaleej Today has confirmed it and it has been modified, and it may have been completely transferred or quoted from it and you can read and follow this news from its main source.