The Senate, the consultative upper house of Egypt’s parliament, gave its approval to the country’s socio-economic development plans for the fiscal year 2026/2027 this week. According to Egypt’s 2024 Constitution, the Senate must be consulted about the state’s annual development plans before referring them to the House of Representatives to secure a final vote.
Addressing the Senate on Monday, Planning and Economic Development Minister Ahmed Rostom affirmed that the plans come at a time when the world is witnessing successive economic and geopolitical challenges due to the war in the Middle East and its repercussions on international supply chains, in addition to rises in energy, food, and other prices, increases in the imports bill and trade deficit, and a rise in global inflation.
Despite these disruptions, the government is targeting real GDP growth of 5.4 per cent in 2026-2027, compared to an estimated 5.2 per cent in the current fiscal year, Rostom said.
He explained that there are five key sectors that drive economic growth.
“These sectors will contribute about 64 per cent to overall economic growth in 2026-2027 and include the manufacturing sector, which contributes 29 per cent, followed by the wholesale and retail trade sector at 11.3 per cent, the tourism sector at 9.3 per cent, the construction sector at 7.2 per cent, and finally the agriculture sector with a contribution of seven per cent,” he said.
Rostom said the new socio-economic development plans for the 2026-2027 fiscal year target a total investment volume of approximately LE3.7 trillion. “For the first time, private investment will account for up to 59 per cent (LE2.2 trillion), while public investments will represent 41 per cent (LE1.5 trillion),” he said.
He added that “the private sector has become a key partner, and the government aims for it to reach an investment rate of 20 per cent of GDP by 2029/2030.”
Rostom indicated that the new plans are based on the government’s vision of placing citizens at the heart of the development process.
“The slogan of the new plan is ‘Building the Human Being’, through which we are following the directives of President Abdel-Fattah Al-Sisi to increase allocations for education, healthcare, basic services, and productive sectors,” he said.
He added that a significant share of investments is allocated to the human development sectors. “Spending on education, healthcare, youth, and cultural services account for about 48 per cent of public funding,” he said.
Rostom stressed that the plans also place the Decent Life Initiative at the top of its priorities. “We are all proud of this presidential initiative and are seeking to complete its first phase and start the second,” he said.
The education sector will see the implementation of 1,304 projects, while the healthcare sector includes 623 projects aimed at advancing the comprehensive health insurance system and upgrading hospitals and ambulance services.
Rostom announced a 25 per cent increase in allocations for the health sector, an 11.5 per cent increase for pre-university and technical education, an 11 per cent increase for higher education, a 15 per cent increase for scientific research, and a 27 per cent increase for Al-Azhar.
He said that the government aims to increase the number of Egyptian-Japanese schools to 100, in addition to rehabilitating 1,000 technical schools in partnership with the private sector.
He said that the plan pays significant attention to social protection, as the allocations for the Ministry of Social Solidarity have increased by 57 per cent to implement a number of urgent family and early childhood development projects.
Rostom said the health and education sectors are exempted from the state’s austerity measures adopted following the eruption of the Iran war in March. “The projects that were postponed due to austerity measures are energy-intensive ones postponed in order to save energy,” he said.
Allocations for utilities, drinking water, sanitation, and social housing are set to rise by 22 per cent and 21 per cent, respectively.
To enhance energy security and the green transition, Rostom said the plans will see a record increase of 261.1 per cent in allocations for the electricity and renewable energy sector to strengthen the national electricity grid, accommodate new generation capacities, and secure strategic projects.
The plans were rejected by the leftist Tagammu Party, however, with Chairman Mohamed Abdel-Aal considering that they do not offer solutions to Egypt’s economic challenges.
Abdel-Aal said that the government’s dependence on foreign borrowing to achieve the plans’ objectives is a very risky policy. He also questioned the economy’s ability to shift towards increased exports in the light of ongoing challenges, stressing the need to work on strengthening local production and reducing the dependence on imports.
Senator Nagi Al-Shehabi also rejected the plans, warning that they do not serve social-protection goals. “These plans have been published while the government is moving towards replacing subsidies with direct cash assistance,” Shehab said, telling Rostom to “beware of tampering with the people’s food.”
Alaa Abdel-Nabi, deputy chair of parliament’s Agriculture and Irrigation Committee, also announced his “categorical rejection of the development plans,” stressing that the indicators on which the budget was built are “incorrect and do not reflect reality”.
Abdel-Nabi criticised the government’s estimates of inflation rates, claiming that there is a large gap between reality and the official figures.
“It is illogical for the government to base its plans on targeting an inflation rate of 9.3 per cent while the actual inflation rate reached 37 per cent in previous years, then declined to 14 per cent, and is now rising again,” he said.
* A version of this article appears in print in the 11 June, 2026 edition of Al-Ahram Weekly
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