We succeeded in striking a balance between preserving citizens’ health and maintaining national economy’s activities...

• Egypt is among best countries in decreasing debt levels by 20% over three years despite ‘Corona Pandemic’.
• The Government increases development projects to raise citizens' standard of living and improve public service quality.
• Continuous praise of international institutions to Egypt lures investments and provides more job opportunities.
• GDP of Egyptian economy is expected to reach EGP 6.4 trillion in the current FY.
• Egypt's credit rating is maintained with a stable future outlook amid Corona crisis.
• USA Goldman Sachs: Egypt managed to curb inflation rates.

 

Finance Minister Dr. Mohamed Maiat confirmed that the achieved economic gains encourage the Egyptian government to continue its development efforts and to perform structural reforms in an attempt to enhance national economy, raise citizens' standard of living and improve public service quality in a way that conforms to the unprecedented national projects carried out by Egypt to provide a decent life for all Egyptians. 

 

GDP of the Egyptian economy is forecast to mount up to EGP 6.4 trillion thanks to the expansion in implementing development investment projects that reflect the State's success, as guided by its sound leadership, to keep a balance between preserving citizens' health and proceeding with activities of the national economy, Dr. Maait added.

 

Praise of the international funding institutions together with international credit ratings agencies, all help to attract new investments and to create more job opportunities. Moreover, it contributes to localizing the advanced global industries and modern technologies, boosting Egypt's productivity, expanding export base and enhancing competitiveness of the Egyptian products across international markets, Dr. Maait pointed out.

 

International credit rating agencies, namely "Moody's, Fitch, Standard & Poor's", all decided to maintain Egypt's credit rating with a stable future outlook amid Corona crisis, noted Dr. Maait, stressing that Egypt is one of best countries worldwide to succeed in decreasing its debt levels by 20% over 3 years despite the pandemic.

 

Commenting on the performance of the Egyptian economy, IMF managing director said that it represents “a successful model of economic reform”. On its part, Standard & Poor's expected public and private investments to significantly contribute in achieving mid-term sustainable growth rates of about 5.3% through "2022-2024", whereas Fitch predicted the Egyptian economy to grow by 6% in next FY, and "African Economic Outlook 2021" report also expected that Egypt regains in 2022 its growth rates of 4.9% that were registered in the pre-Corona period.

 

In the same context, Dr. Maait indicated that the “American Goldman Sachs” institution, one of the biggest financial institutions in the world, considered Egypt to be one of the fewest countries which managed to curb inflation, as opposite to most countries which continued to witness an upward inflation levels since the beginning of 2021.

 

He also pointed out that “Standard & Poor's” agency maintained Egypt's same credit rating for three consecutive years since the onset of “the pandemic”. Moreover, “Capital Intelligence” Agency has recently placed Egypt's credit rating at "+B" with a stable future outlook, while “Fitch” Agency lauded the State's new FY general budget draft law thanks to setting objectives with broad credibility levels that in turns help in enhancing the government economic and financial strategy and reduce mid-term debt burdens.

 

Thanks to spending control measures adopted by Egypt over the past years, significant financial savings were achieved, stressed Dr. Maait. Accordingly, such savings helped to avoid economic downturn, complete structural reform policies, curb inflation and unemployment levels, and provide foreign reserves for the banking sector that rounded USD 40.3 billion by end of last April.

 

Egypt's joining “J.P. Morgan” Watchlist for emerging-market government bonds, as a step towards listing the Egyptian government's local currency debt instruments in the Index, reflects relentless efforts of the Ministry of Finance to reduce public debt costs within the framework of the economic reform measures adopted by the State. This has been executed in parallel efforts with implementing MoF's mid-term public debt strategy, which additionally proposes a rapid decrease of debt levels of budgetary entities through activating the stock market in a way that help in increasing liquidity, raising demand levels on public debt instruments and reducing their costs accordingly, noted Dr. Maait.

 

Egypt's success in joining this Index reflects Egypt's keenness to fulfill the Bank requirement, including increasing term of public debt, improving Yield curve, increasing foreign investors’ participation in the government financial tools and increasing volumes of each issuance, added the minister.

 

“Morgan Stanley for Financial, Investment and Banking Services”, in its last February-issued report, classified the Egyptian debts under the best credit rating of the developing debtor countries, in accordance with the positive results of risk-level criteria for paying debts. Hence, it reflects the State’s ability to control debts and to access to debt markets, and underlines the size of financing flows from abroad, the minister added. In the same context, “Fitch Ratings” report expected a reduction in total deficit to reach 6.7% of GDP by the end of June 2022 compared to 7.9% by the end of June 2021, the minister also indicated.

 

Lastly, as the minister pointed out, IMF raised the Egyptian economy growth rate estimation for next FY 2021/22 to 5.7% compared to 5.5% as shown in its last January-issued report. Furthermore, IMF expects that an acceleration in Egypt’s growth rate to reach 5.8% in FY 2025/26, along with a downward in inflation rate in current FY to 4.8%, down from 5.7% in FY 2019/2020, while in the meantime IMF expects counterpart regional economies to have an upward hyperinflation of 12.4%. Subsequently, all these indicators reflect the ability of Egyptian economy to quickly recover from the negative repercussions of Corona pandemic.