Egypt’s GDP drops by EGP130 bln, growth rate falls to 4% due to coronavirus: Finance minister

Doaa A.Moneim , Monday 8 Jun 2020

File Photo: Mohamed Maait, Egypt's finance minister, at a Bloomberg Television interview in Cairo, Egypt. (Photo Courtesy of Bloomberg)

Minister of Finance Mohamed Maait said on Monday that the COVID-19 crisis has resulted in a drop in the gross domestic product (GDP) BY EGP 130 billion, and the economic growth rate for the current fiscal year (FY) 2019/2020 has declined to four percent, down from the targeted six percent.

He added in a statement that tax and non-tax revenues dropped by EGP 124 billion on the back of the COVID-19 pandemic outbreak that affected economic conditions globally.

Maait stressed that his ministry is committed to providing the increases needed in specific sectors’ allocations in FY 2020/2021 budget in implementation of President Abdel-Fattah El-Sisi's directives.

Maait stated that the total additional sums that the government has appropriated for supporting the healthcare sector and other hard-hit sectors and categories amid the current crisis have reached EGP 63 billion out of the EGP 100 billion that President El-Sisi instructed to be allocated for countering the implications of the pandemic.

Additionally, according to Maait, the ministry is committed to provide the monthly allocations needed for commodities and services to meet the citizens’ needs.

Allocations of EGP 11 billion were dedicated to back the healthcare sector to help it take the pre-emptive and precautionary measures against the virus and to disburse the extra bonuses to medical staff and isolation workers, according to Maait.

He added that EGP 400 million are to be allocated annually to finance the appointment of 7,000 research assistants and assistant teachers in medicine faculties at governmental universities, in addition to financing the appointment of 1,200 senior fellows at teaching hospitals affiliated to the health ministry.

He clarified that EGP 16.6 billion were approporiated to increase the infection exposure bonus by 75 percent for medical crews.

In the industrial sector, Maait unveiled that EGP 16.6 billion were allocated for the sector to counter the COVID-19 implications, adding that EGP 3 billion were provided from April to June to back the Exports Support Fund and to provide an extra liquidity for exporters.

Moreover, EGP 5 billion were allocated to support the tourism and civil aviation sectors, in addition to increasing public investments with EGP 10 billion to maintain the workforce and pay contractors and suppliers' dues, according to Maait.

Maait declared as well that EGP 6 billion were allocated to the Supply Commodities Authority to purchase 1.6 tonnes of imported wheat, and EGP 3 billion were provided for irregular labour.

He added that EGP 3 billion were allocated for implementing an urgent plan to pave internal roads in governorates and EGP 450 million were provided for the education ministry to finance the pre-emptive measures against the COVID-19.

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