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Thursday, 29 March 2018

PM receives FY2018-19 budget for review before shipping it off to the House by 31 March

BUDGET WATCH- New state budget with prime minister, due to House on Saturday: The Finance Ministry handed the state’s FY2018-19 budget over to Prime Minister Sherif Ismail yesterday for review before it’s sent to the House of Representatives on Saturday, 31 March. As we noted on Monday, the budget includes a GDP growth target of 5.8%, aims to reduce the budget deficit to 8.4% of GDP, and achieve a primary surplus equivalent to 2% of GDP. The new budget also sees sovereign debt coming in at 91% of GDP and government earnings growing by 22% y-o-y to exceed an estimated 15.5% y-o-y rise in public spending, according to a Cabinet statement.

The FY2018-19 budget allocates EGP 322 bn to social welfare and protection programs. The government also earmarks EGP 266 bn for public wages, EGP 149 bn to government investments in infrastructure projects and services (particularly in Upper Egypt and governorates along Egypt’s borders), and EGP 60 bn for ensuring the availability of basic commodities and services. Prime Minister Sherif Ismail had said last week that the government would be shoring up the social safety net in the new budget through wage increases for public sector workers, adding new citizens to the Takaful and Karama programs, and increasing spending on commodity subsidies for the lowest income citizens.

The Ismail cabinet is expected to present the budget to President Abdel Fattah El Sisi before it’s shipped off to the House, Finance Minister Amr El Garhy confirmed to AMAY.

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