File photo: Finance Minister Ahmed Galal (Photo: Finance Ministry)
The Egyptian government plans to increase its stimulus spending by around LE30 billion ($4.36 billion), Egyptian Minister of Finance Ahmed Galal announced on Monday.
At least a third of the stimulus package will be allocated to cover the recent salary increases for teachers and doctors in the public sector, as well as to cover the minimum wage scheme, Mesbah Qotb, spokesman for the finance ministry, told Ahram Online on Monday.
The remainder of the package will be spent on infrastructure projects.
Last week, the finance ministry announced that it had approved LE2 billion ($290 million) in incentives to be added to the pay scheme of public sector teachers.
In addition, the new minimum wage scheme for public sector workers will cost the treasury LE9 billion ($1.31 billion) in the second half of the current fiscal year, according to a finance ministry statement in October.
"The exact figure for the additional package will depend on how much revenue we will be able to allocate to the package," said Qotb.
The finance ministry is working on allocating sources of revenue to the stimulus package. These could include the decrease in the public cost of borrowing following the recent cut in interest rates, as well as an anticipated mineral resources law, added Qotb.
The Egyptian central bank slashed both the deposit and lending rates by 50 base points to reach 8.25 and 9.25 percent respectively earlier this month.
In August, the interim government announced a stimulus package worth LE22.3 billion ($3.24 billion) to be spent on a variety of projects. It was subsequently increased to LE29.6 billion ($4.3 billion).