Egypt's finance minister Mohamed Maait speaks during a business forum held in Cairo in the light of a major US mission delegation (Photo: Momen Sobhi)
Egypt is aiming for economic growth of 8 percent by 2021/22, Finance Minister Mohamed Maeet said on Wednesday during a business event organised by the American Chamber of Commerce in Egypt.
Maeet made the comments at a ministerial panel held in Cairo for a major US business mission to Egypt of senior executives representing major US companies.
The minister highlighted efforts by his ministry to overcome economic imbalances amid the country’s ongoing economic reform programme.
The reforms, which include the flotation of the Egyptian pound and fuel and energy subsidy cuts, have been receiving thumbs up from international financing organisations, while critics have said that the reforms negatively affect the lives of Egypt’s poor.
In November 2016, Egypt secured a $12 billion loan from the International Monetary Fund, $8 billion of which have reached Egyptian coffers so far.
“The Egyptian economy has been going through difficulties… this was all necessary to reach the right path,” Maeet said.
Maeet also announced the country’s ambitious plan for more growth over the next few years, saying the current growth rate is 5.8 percent though contributions by the sectors of agriculture, petroleum, tourism, and manufacturing.
Egypt's growth rate for the 2017/18 fiscal year hit its highest level in 10 years, recording 5.3 percent growth last July, compared to 4.2 percent the year before.
The minister said that economic indicators have reflected major progress in the last period according to international rating agencies.
He also highlighted the decline in unemployment, saying that unemployment has fallen to 9.9 percent in June 2018, compared to 13.3 percent in June 2014 and 12 percent for the same period the previous year.
He also pointed out that the overall subsidy costs are declining with the fuel subsidy cuts, and that this has created “space for financing other programmes as well as lowering the deficit.”
The overall subsidy bill has reached 6.3 percent of GDP, according to the minister.
The cuts have helped in financing cash transfer programmes, food rations, as well as the solidarity ministry’s Takaful and Karma programme, which is one of the major safety net programmes for the poor.
According to Maeet, the budget deficit has also fallen from 16.7 percent to 9.8 percent in the current year.
Egypt is aiming to reach a budget deficit of 8.4 percent by the end of the year; as well as a primary surplus of 2 percent during the current fiscal year.