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Finance: Government indebtedness decreased by 20.5% of GDP within 3 years


The economic gains prompted us to undertake structural reforms without burdening the citizens

Maintaining financial stability to ensure sustainable growth and reduce the deficit and debt

We succeeded in reducing the budget deficit from 12.5% ​​in 2015/2016 to 7.9% in 2019/2020, and we expect it to reach 6.7% by the end of the next fiscal year.

Converting the first deficit of 3.5% of GDP into a first surplus of 1.8% in 2019/2020

We expect the first surplus to reach 1% of GDP by the end of this year and 1.5% in the next fiscal year

Annual inflation declined to 4.5% in March 2021 from 23.3% in 2016

Foreign exchange reserves exceeded $ 40 billion in April 2021, to cover more than 7 months of the invoice of goods and services imports.

Unemployment rates decreased to 7.2% in December 2020 instead of 13.3% in 2013

Enhancing spending on development projects ... to improve the citizens' standard of living

The “Treasury” bears the burden of fixing electricity and gas prices for the industry by 10 billion pounds over 3 years

The new fiscal year witnesses, for the first time, the preparation of a "medium budget" that extends for three years

Incorporation of the "general budget" law and "governmental accounting" into the "unified public finance" to keep pace with the automated systems

We have come a long way in digitizing the tax and customs systems over the past two years

The platform for "unified automated tax procedures" at the center of large and medium financiers and major professions

The taxpayer submits all returns and pays all types of taxes electronically ... with one tax number

We aim to have 2,800 companies join the "electronic invoice" before the end of next May

We have 6 million electronic documents for 467 companies in a month and a half

189 companies on the "white list" end customs release procedures for shipments at any port

Dr. Mohamed Maait, Minister of Finance, confirmed that economic reform is a dynamic process, and Egypt has succeeded in the elaborate implementation of the first phase of its comprehensive national program, with the certification of international financing institutions and classification, in a manner that has achieved gains that have given the Egyptian economy a great deal of rigidity in the face of internal and external crises, and pushing The government to launch the second phase, which includes a package of structural reforms that do not include any additional burdens on citizens.

The minister added that there is a package of structural reforms at the level of macro-financial policies; In order to achieve financial stability, control the budget deficit rates and the public debt of the domestic product, maintain a sustainable economic growth rate, raise the efficiency of collecting public revenues, and ensure their good management, in the manner that is reflected in enhancing spending on development projects aimed at improving the citizens' standard of living. And upgrading the services provided to them, along with continuing to support the economic sectors and groups most affected by the Corona pandemic, pointing out that the state treasury bears the burden of fixing electricity and gas prices for the industrial sector during the next three years; In line with the state's efforts to localize advanced industries according to the latest global experiences, deepen local production, and enhance the competitiveness of Egyptian exports, especially in light of the government's endeavor to quickly respond to the export development fund's late burdens through many programs, the latest of which was the "immediate cash payment" initiative.

The minister pointed out the importance of concerting all efforts to make the national integrated program for structural reforms a success to complement the reform process and aim to achieve the comprehensive development of the country, stressing that the Ministry of Finance continues to complete the public finance reform procedures, achieve fiscal control, and put the overall deficit and public debt on a sustainable downward path by implementing reforms on The public spending side aims to improve public financial management systems, re-prioritize public spending, and medium-term sustainability. In this context, we achieved some financial and economic successes as we were able to reduce the budget deficit that exceeded 12.5% ​​of GDP in 2015/2016 to 7.9 In the year 2019/2020, it is expected that it will reach 7.7% by the end of the current year, and 6.7% in the next fiscal year, and the first balance has shifted from a deficit of 3.5% of GDP in 2015/2016 to a first surplus 1.8 % Of GDP in 2019/2020, and it is expected that 1% of GDP will reach by the end of this year, and 1.5% in the next fiscal year.

The minister added that government indebtedness decreased by 20.5% of GDP over 3 years from 108% of GDP in June 2017 to 87.5% in June 2020, and government debt is expected to be 89% of GDP by the end of June. 2021, and in the next fiscal year as well, pointing to the stability of the prices of most goods and services, bringing the annual inflation rate to 4.5% in March 2021, down from 23.3% in 2016, and about 22% in 2017. Large to exceed $ 40 billion in April 2021, to cover more than 7 months of the invoice of goods and services imports, and unemployment rates fell to about 7.2% in December 2020, down from 13.3% in 2013.

He said that the new fiscal year will witness, for the first time, the preparation of a "medium budget" to be presented to the House of Representatives, and will extend for the next three years, stressing that the unified procurement system aims to rationalize public spending and consumption, and that 15 model government contracts have been approved; In a way that contributes to enhancing governance and transparency.

He pointed out that the "general budget" law and the "governmental accounting" law governing financial performance in Egypt were merged into the "unified public finance" bill, especially after they had undergone many amendments, and it was clear that they were incompatible with the changes in the pattern of budget preparation, implementation and control. In light of the successive developments and the shift to automated systems, explaining that the draft law on “unified public finance” reflects the philosophy of financial performance in the Egyptian economic system, in line with modern automated systems, and targets the rational management of public money through the proper application of the balance of programs and performance, and raising the efficiency of financial performance With the ministries and administrative authorities using scientific methods and technical techniques, and effective contribution in determining priorities for public spending, in cooperation with the Ministry of Planning, in addition to achieving the highest level of transparency and disclosure in preparation, implementation and control, and consolidating the concepts of accountability and accountability, and preparing budgetary frameworks to ensure good financial planning and developing a future vision For the financial performance of the administrative authorities.

The minister affirmed that we have made great strides over the past two years in digitizing the tax and customs systems, in a way that contributes to stimulating investment through automating, integrating and simplifying procedures, collecting the state’s right, and integrating the informal economy into the formal economy. The first phase of the system of unified tax procedures has been launched. Automation in the center of large and middle financiers and senior professions, so that the taxpayer submits declarations on this electronic platform with one tax number that includes all types of taxes, and pays electronically as well, indicating that Egypt is one of the first in Africa and the Middle East to implement the "electronic invoice" system that 467 joined. The company has so far been in two phases, including 37 voluntarily companies, and we have 6 million electronic documents within a month and a half, and it is targeted before the end of next May to join 2,800 companies in the status of major financiers to this advanced electronic system.

The minister said that the new customs law is based on simplifying procedures, developing new customs regulations, and optimizing the use of modern technology, taking into account developments in global trade and Egypt's international obligations. In order to enhance our competitiveness and raise Egypt's ranking in customs classifications, pointing out that we aim to reduce the customs release time; This will be reflected in reducing the cost of goods and services in the local market, by linking all land, sea and air ports to a single electronic platform through a window system, pointing out that the pre-registration system for shipments and the risk management system aims to dispense with paper documents and make use of the mechanisms of connecting the electronic single window system. With international supply chain networks that operate with modern and secure technology, and then data of shipments can be obtained electronically from the country of export, and rejected goods are not allowed to be moved from their port of export; In order to avoid the accumulation of neglect in the ports.

He pointed out that the number of beneficiaries of the economic actor project or the white list reached 189 companies of import, export and customs clearance with good reputation and a newspaper free of any violations in international trade, which can quickly finish the procedures for releasing their shipments at any port after completing the required documents and approvals.