Egypt's economic reform program more than 85% complete: New finance minister

Karima Abdel Ghani , Monday 18 Jun 2018

Finance Ministry Mohamed Moeet (Photo: Al-Ahram)

More than 85 percent of Egypt's ongoing economic reform programme has been put into effect so far, newly-appointed Finance Minister Mohamed Maeet said in an interview with Al-Ahram Arabic newspaper hours before his swearing in to the new cabinet on Thursday.

In the lengthy interview, Minister Maeet spoke about a number of issues including price hikes and his goals to make government subsidies available to those citizens who deserve it.

Asked about the ongoing reforms, Maeet said that the benefits include new job opportunities, increasing production rates, maintaining reserves and reducing the budget deficit and borrowing.

"We aim to create more job opportunities; we also aim to make foreign currency available while decreasing the inflation rates," said Maeet, adding, "We cannot deny that the Egyptian citizens have been suffering from the economic situation."

The minister also pointed out that recent salary raises for government employees were aimed at alleviating the burden of the new price hikes.

"We are aware of the price hikes, which are what urged us to bring in an increase in [government] salaries greater than those introduced last year," said the minister. 

Referring to fuel subsidy cuts, Maeet said, "I want Egyptian citizens to think fairly about whether state subsidies should be directed towards education, health and building social housing instead of slums and filling petrol tanks."

"It is not the responsibility of the state to fill car tanks with gasoline," says Maeet.

Maeet explained that the real support should be directed to medical services in hospitals and better salaries for teachers.

During the interview the minister also highlighted the importance of transforming the subsidies system into cash subsidies to be paid directly to citizens who truly deserve them.

"I believe that each citizen should own his or her own personal account where the cash subsidies can be deposited, but this is still being studied by the government. We are still currently in the reform phase," he said.

Concerning pensions in the new fiscal year, Maeet stated that he expected EGP 69 billion to be allocated to pensions.

"Pensions will increase by 15 percent, which will cost the state's budget EGP 28 billion," he explained.

During the interview, the minister said the floation of Egypt's currency in November 2016 will reduce production rates.

He also highlighted that the Egyptian government has been bearing the costs of insurances and pensions for the past 40 years.

Being asked about social security measures that the state will be taking to support those in need, the minister said that most state employees will receive a minimum increase of EGP 265, whereas fifth and sixth-tier employees will receive an increase of EGP 200.

He also noted that pensions are set to increase by 15 percent.

"For pensions, we started with three procedures, starting with the 15 percent increase like last year, but we also raised the minimum from 125 to 150 pounds for the increasing value and raised the minimum pension from 500 to 750," said Maeet.

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