Minister of Planning Hala El-Said said that the new development plan aims to raise the percentage of economic growth up to 5.4 percent, from the 2.6 percent in current year
The Senate - Egypt's Consultative Upper House - approved the state's 2021-22 socio-economic development plan at a plenary session on Sunday.
Representatives of most political parties said they approved the plan because it aims to raise economic growth and helps the country ride out the damaging effects of the coronavirus pandemic.
Mahmoud Sami, the Representative of the Egyptian Socialist Democratic Party, was the only senator who voted no to the plan.
In a statement before the Senate, on Sunday, Minister of Planning and Economic Development Hala El-Said said Egypt's 2021/22 socio-economic development plan targets EGP 1.250 trillion in overall investments, of which EGP 385 billion (five percent of GDP) is to be injected by the government into projects throughout Egypt.
"These investments have gone up by 17.6 percent from last year and aim to raise economic growth up to 5.4 percent, up from the 2.6 percent in the current fiscal year," said El-Said, arguing that "as you know, the more you inject investments, the more you raise the rate of economic growth."
El-Said also said that as much as 58 percent of government investments, estimated at EGP 358 billion in 2021/22, will be devoted to spending on social services; 18.6 percent is to be directed to transport and sanitary drainage services, while the remaining investments are to be allocated to the sectors of telecommunications; agriculture; electricity; water; construction; real estate and information technology.
El-Said added that one third of government investments will be earmarked to achieve sustainable development in upper Egypt along with the border governorates.
"The remaining two thirds of investments will be used to expand on building new housing communities, implementing environment-friendly projects, improving life in slum areas and reducing dioxide emissions," said the minister.
As for private investments in the new socio-economic development plan, El-Said said these will stand at EGP 317 billion (25 percent of overall investments in the new plan and up from the 23 percent last year).
"These kind of investments will focus on sectors of real estate, manufacturing industries, natural gas discoveries, telecommunications and agriculture," said El-Said.
She also said that the net direct foreign investments are expected to reach $7 billion in 2021/22 and this will almost be equal to the pre-COVID-19 level.
"The International Monetary Fund (IMF), however, forecasts that net direct foreign investments in Egypt will reach $8.3 billion in 2021/22, $11.4 billion in 2022/23, $14.6 billion in 2023/24 and $16.3 billion in 2024/25," said El-Said, adding that "these estimates show that international financial institutions are optimistic about the investment climate in Egypt."
El-Said also argued that Egypt's 2016-2019 economic reform programme - the government's intervention to settle the business sector's legal disputes and the creation of a fast licensing system - all led to improving the investment climate in recent years.
Besides, El-Said said that the new development plan hopes to boost revenues from the tourism sector to $6 billion and increase foreign exchange reserves to $42 billion, at the end of the fiscal year of 2021/22.
In other terms, El-Said said the new development plan seeks to reduce population growth by two percent, cut annual inflation rate to six per cent, push the unemployment rate down to 7.3 percent and reduce the poverty rate to 28.5 percent.