Egypt launches final sustainable development strategy for 2030

Ahram Online , Wednesday 24 Feb 2016

ONTV screenshot of Egypt's President Abdel-Fattah El-Sisi during the launch of 'Egypt's Vision 2030' on Wednesday 24 February 2016

Egypt launched on Wednesday the final draft of the country's sustainable development strategy for the next 15 years with the aim to raise Gross Domestic Product (GDP) growth to 12 percent in 2030, up from the 4.2 percent attained last fiscal year, while reducing the budget deficit to 2.28 percent from 11.5 percent.

Egypt began an economic reform plan in June 2014 in hopes of boosting an economy battered by years of political upheaval.

The strategy announced in March last year during the Economic Development Conference in Sharm El-Sheikh has been finalised after societal discussions and is the product of two years of preparation, said planning minister Ashraf El-Araby in a launching event attended by President Abdel-Fattah El-Sisi.

"The sustainable developing strategy incorporates economic, social, and environmental dimensions in addition to knowledge and innovations," said Prime Minister Sherif Ismail at the Cairo-held conference on Wednesday.

According to Ismail, the 2030 plan is to expand investors base, individuals and companies, raising the contribution of the private sector to 75 percent of GDP up from 60 percent.

Egypt will continue to make the best use of aid from Arab Gulf countries as well as issue new securities to finance projects including Islamic 'Sukuk' and international bonds, said Ismail.

Last year, finance minister announced the government plans to issue in fiscal year 2014/15 sovereign sukuk (Islamic bonds), which are lease-based, implying that bondholders are owners of the assets and are entitled to receive revenues when the asset is leased.

Egypt would deprive itself of around $4-5 billion in financial resources if it missed out on tapping the international sukuk market, which traded around $116 billion last year, Egypt's head financial regulator, Sherif Samy, told Ahram Online in April 2015.

In June, Egypt raised in the international bond market $1.5 billion at a yield of 6 percent for 10 years as part of a $10 billion programme.

For his part, the governor of Egypt's central bank Tarek Amer said the bank's main objective in the upcoming years will be boosting the growth of small and medium enterprises (SMEs).

The CBE has allocated EGP 5 billion ($647 million) for the banks to loan to medium sized enterprises in the industrial and agricultural sectors.

Last month, the CBE issued a directive requiring banks to allocate 20 percent of their total loaning portfolio for SMEs, with interest rates of up to 5 percent imposed on firms generating between EGP 1 million and 20 million a year in revenue.

The instructions were part of an initiative launched on 9 January by El-Sisi, who announced that Egypt’s banks would give EGP 200 billion in loans to small and medium enterprises over the next four years.

The nationwide programme aims to finance 350,000 businesses, creating 4 million new jobs during that period, according to the CBE.

However, in a comment addressed to Amer at the conference, El-Sisi assured that the development of SMEs must be part of government planning and within industrial zones allocated and specified by the state to small businesses.

The unemployment rate is targeted at 5 percent in 2030, down from 12.8 percent in 2015.

Population poverty rate should fall to 15 percent down from 26.3 percent according to the government vision.

The strategy website shows the objective is to raise Egypt's contribution to global GDP to 1 percent, up from 0.21 percent in 2015, and increase the ranking in competitiveness, transperancy and ease of doing business to rank 30th worldwide by 2030.

Short link: