(DNE Photo)
The Egyptian government is targeting EGP 37.8bn in investments for the infrastructure sector during the new fiscal year (FY) 2015/2016, of which EGP 25.5bn will come from the state budget. The latest figure represents a 19.5% increase from FY 2014/2015, the Ministry of Planning revealed in a report published on Friday.
The volume of investments targeted for the transport sector in the new budget amounts to EGP 11.9bn, where EGP 7.7bn (or 64.7%) will be directed to construct and establish main road networks and bridges. A further EGP 4.6bn (34.1%) will be allocated to develop metro lines, EGP 100.8m (0.8%) will go towards raising the efficiency of river transport, and EGP 48m (0.4%) will go to develop maritime transport.
Regarding investments for housing, utilities and urban development programmes, the government has targeted EGP 20.6bn. A further EGP 987.7m will be used for agriculture development programmes.
The Planning Ministry added that the industry and foreign trade sector needs EGP 287.6m in investments, where exports development investments would need EGP 40.7m. Meanwhile, the targeted investments for the electricity sector amounts to EGP 414m.
The volume of economic growth in the first nine months of FY 2014/2015 had reached 4.7%, according to the recent report.
The draft budget, approved by the cabinet on the first day of Ramadan, set the target for the deficit in FY 2015/2016 at 9.9% of gross domestic budget (GDP), or around EGP 281bn. The budget deficit for FY 2014/2015 stands at 10.8%. The GDP growth is expected to reach 5% during the new fiscal year, compared to 4.2% during the current fiscal year.
For FY 2014/2015, the government set a goal of 10% of GDP for the deficit, compared to 12.8% of the GDP in FY 2013/2014.
The budget is targeting a 22% increase in spending on health, surging by EGP 11.5bn to reach EGP 64bn. Spending on education will jump by 8.3%, increasing by EGP 9.2bn to reach EGP 120bn.
Spending on wages is predicted to reach EGP 228bn, climbing by 27.3%, compared to the previous fiscal year and representing 14% of the total public spending.
Spending on programmes seeking “direct social protection” will reach EGP 431bn. This represents some 49% of the total public spending and a 12% increase compared to FY 2014/2015. Around EGP 11.2bn of the mentioned figure will be directed to pensions, while EGP 4.2bn will go to health insurance.
The budget allocated for petroleum subsidies for FY 2015/2015 is EGP 61bn, while EGP 38.4bn will go to supporting the food commodities’ subsidies.
Revenues from taxes are expected to record EGP 407bn. Tax income from international trade is predicted to record EGP 26.9bn in FY 2015/2016, inching up by 24.8% compared to the previous fiscal year.
Prior to his election, President Abdel Fattah Al-Sisi set a goal to reduce public debt to 74.5% of GDP. In the budget draft, the government states, however, that the new goal for public debt reduction in FY 2018/2019 is 85%. The public debt increased in 12 months from EGP 1.8tn, 90.4% of the GDP in March 2014, to EGP 2.1tn, 93.8% of GDP.
