Cabinet signs off on the draft FY2021-2022 budget
Well, we have a draft FY2021-2022 budget, after the Madbouly cabinet signed off on it yesterday. Finance Minister Mohamed Maait had said earlier this month that spending under the budget will rise 9% y-o-y to EGP 1.76 tn. Government expenditure on investment will account for 27.6% of total expenditures, with a focus on improving the quality of public services and infrastructure.
GDP growth is projected at 5.4% and could climb to 6% in the following fiscal year if everything goes according to plan, Maait told Yahduth fi Misr’s Sherif Amer last night (watch, runtime: 6:10).
The budget is penciling in a primary surplus of 1.5%, compared to 0.9% in the current fiscal year, Maait said. The minister had previously said the primary surplus in FY2020-2021 is at 0.6%. The overall deficit is expected to narrow to 6.6% in FY2021-2022, from its current 7.8%.
Other highlights include:
- Revenues rising 16.4% y-o-y to EGP 1.3 tn, up from EGP 1.12 tn in FY2020-2021, on the back of increased tax revenues amid efforts towards electronic tax collection and financial inclusion;
- Supply commodities subsidy spending will come in at EGP 87.8 bn, rising from EGP 83 bn this fiscal year;
- Pension fund allocations are expected to reach EGP 180 bn;
- Increases in public wages will cost EGP 37 bn of total spending, including civil servants seeing their minimum wages raised to EGP 2.4k from EGP 2k as of July.
WHAT’S NEXT? The document will make its way to the People’s Assembly, where it will be discussed in committee before going up for a vote by the House general assembly.