Egypt’s Cabinet approves FY2025/’26 budget

Egypt’s Cabinet has approved the draft budget for the fiscal year 2025/2026 and referred it to the Parliament for endorsement, as per a Cabinet statement on Wednesday

The budget outlines a total revenue of 3.1 trillion Egyptian pounds, reflecting an annual growth of 19 per cent, while expenditures are projected at 4.6 trillion pounds, marking an 18 per cent increase.

Moreover, the government aims to achieve a primary surplus of 795 billion pounds, or 4 per cent of GDP, while reducing public budget debt to 82.9 per cent of GDP.

Increased Spending on Social Sectors

Finance Minister Ahmed Kouchouk emphasised that the budget aligns with presidential directives to boost investment in health, education, and social protection, alongside efforts to support productive and export-driven sectors.

As part of these measures, spending on public employee wages will rise by 18.1 per cent to 679.1 billion pounds, ensuring the implementation of new salary increases from July 1. Additionally, the budget meets constitutional spending requirements for education, health, and scientific research.

Enhanced Healthcare and Social Protection Allocations

The budget dedicates significant resources to the healthcare sector, including:

• 22 billion pounds for medicines, 12.4 billion for raw materials, 11 billion for medical supplies, 2.8 billion for medical equipment maintenance, and 5 billion for therapeutic medicines and infant formula.

• 15.1 billion pounds for state-funded treatment of uninsured, low-income citizens.

• 5.9 billion Egyptian pounds for health insurance coverage, benefiting students, female breadwinners, children, and beneficiaries of the Universal Health Insurance system.

Moreover, 732.6 billion pounds has been earmarked for subsidies, grants, and social benefits, representing a 15.2 per cent increase. These allocations primarily focus on supporting vulnerable groups, including:

• 160 billion pounds for subsidised food commodities and bread, a 20 per cent increase from the previous year.

• A 35 per cent increase in Takaful and Karama Programme, raising total allocations to 54 billion pounds. This includes a 25 per cent increase in monthly cash assistance starting in April.

• 75 billion pounds for petroleum product subsidies, 75 billion pounds for electricity subsidies, and 3.5 billion pounds for expanding household natural gas connections.

The government has also increased pension fund contributions, allocating 227.1 billion pounds to strengthen retirement benefits. Meanwhile, the transport sector will receive 5.2 billion pounds for railways, 1.8 billion pounds for student transport subsidies, and 2.5 billion pounds for public transport services in Cairo and Alexandria.

Investment in Infrastructure and Economic Growth

To further stimulate economic growth, the budget allocates 78.1 billion pounds—three times higher than previous years—to support production, exports, and tourism. Key initiatives include:

• 8.3 billion pounds for the tourism sector.

• 5 billion pounds for priority industrial activities.

• 3 billion pounds for converting vehicles to run on natural gas.

• 3-5 billion pounds in cash incentives for small, medium, and micro enterprises.

• 1 billion pounds to provide gas-powered taxis and pickup trucks for youth entrepreneurs.

Government’s General Budget

The general budget, covering both the state budget and economic authorities, projects total revenues of 7.2 trillion pounds and expenditures of 8.5 trillion pounds.

With this plan, the government aims to achieve a higher primary surplus and bring down public debt to below 92 per cent of GDP.

Attribution: Amwal Al Ghad English
Subediting: M. S. Salama