Reuters/Amr Abdallah Dalsh
Tourists walk next to an aircraft of Swiss Edelweiss Air at Marsa Alam International Airport upon their arrival at Egypt’s Red Sea coast on March 23, 2025
Egypt’s cabinet approved an EGP4.6 trillion ($91 billion) draft state budget for the financial year that will begin in July, a government statement said on Wednesday, as it continues to tighten its finances under an International Monetary Fund (IMF) programme.
Expenditures will rise by 18 percent and revenue by 19 percent over the current 2024/25 budget. Revenue is expected to hit EGP3.1 trillion, working out to a deficit of about EGP1.5 trillion ($30 billion).
The increased expenditure partly reflects elevated headline inflation, which was running at an annual 12.8 percent in February.
Financial reforms under an $8 billion financial reform programme signed in March 2024 with the IMF have helped Egypt bring inflation down from a peak of 38 percent in September 2023.
The IMF this month approved the disbursement of $1.2 billion to Egypt after its fourth review of the programme.
The new budget targets a primary surplus of EGP795 billion, equal to 4 percent of GDP, up from the 3.5 percent primary surplus originally targeted in the 2024/25 budget.
The IMF granted the government a waiver in the fourth review after the surplus came in 0.5 percent of GDP lower than Egypt’s earlier commitment.
In its third review in June, the IMF praised Egypt for its “strict control of spending”.
The new budget also lowers public debt to 82.9 percent of GDP from an expected 92 percent in 2024/25, the cabinet statement said.
The cabinet said EGP732.6 billion in spending in the new budget would be allocated for subsidies, grants and social benefits, an increase of 15.2 percent.
The budget increases commodities and bread subsidies by 20 percent to EGP160 billion. It will also include EGP75 billion to subsidise petroleum products, EGP75 billion to subsidise electricity and EGP3.5 billion to subsidise natural gas deliveries to households, the statement added.
