CAIRO, May 18 (MENA) - Minister of Planning, Economic Development and International Cooperation Rania Al-Mashat reaffirmed that the economic and social development plan for the upcoming fiscal year comes at an exceptional time for the Egyptian economy, in addition to regional and global transformations.

This came as she delivered a statement before the Senate's plenary session, chaired by Speaker Abdel-Wahab Abdel-Razeq, to explain the draft plan for economic and social development for the fiscal year 2025/2026 and review its main objectives and features.

She noted that Egypt has managed to break free from the vicious cycle that the economy has suffered from over the past years. Since March 2024, the government has begun corrective measures within a framework of consistency and integration, based on harmonious fiscal and monetary policies, strict measures for governing investment spending, and policies and procedures stimulating foreign investments.

These efforts are supported by the effective implementation of the national structural reform program, aiming to solidify macroeconomic stability and ensure sustainable positive reform outcomes, she said.

Mashat pointed out that the benefits of these reforms have emerged in the signs of a noticeable improvement in the performance of the Egyptian economy recently, which was reflected in the economic performance indicators during the first and second quarters of the fiscal year 2024/2025, recording 3.5% during the first quarter and 4.3% in the second quarter, with expectations of reaching a growth rate of about 4% during the year.

She emphasized that this growth was primarily driven by key sectors such as non-oil manufacturing, a recovering tourism sector, and growth in communications and IT, despite ongoing external tensions affecting Suez Canal activity.

The plan adopts a balanced approach to strengthen the economy's resilience against crises and geopolitical and economic disruptions, while leveraging untapped opportunities to accelerate inclusive growth and sustainable development across economic, social, and environmental dimensions.

Mashat noted that the new draft plan is the first prepared by the ministry after the merger of the ministries of planning and economic development and international cooperation.

Therefore, it is consistent with the ministry's new framework, "Sustainability and Financing for Economic Development," which works to link development plans and strategies at the national and sectoral levels, and maximizes the utilization of local and foreign financing sources, in addition to improving resource utilization.

The plan also maintains public investment limits in line with fiscal discipline goals, thus creating more space for achieving macroeconomic stability and allowing the private sector to lead development efforts.

Mashat reviewed the pillars of the plan, which include formulating a new methodology for preparing the plan document that takes into account the preparation of the plan in the context of the medium-term budget framework (2025/2026-2028/2029), which includes the budget year and three subsequent years, thus unifying the time frame of the plan.

She mentioned that this framework is being prepared in consultation, coordination, and cooperation with all relevant authorities within a participatory approach, and within the framework of commitment to the implementation of the Public Planning Law No. 18 of 2022 and the Unified Public Finance Law No. (6) of 2022.

Mashat also outlined that the plan incorporates advanced planning tools and methodology, introduced by the Ministry to improve the efficiency of public investment, track international financing, and monitor performance. Coordination with ministries and institutions ensures higher-quality development planning, with all executing entities provided with a planning guideline.

She also indicated that the plan is based on the state's continued implementation of the national structural reform program with its three pillars, which include enhancing macroeconomic stability, increasing competitiveness and improving the business environment to increase private sector participation, and supporting the transition to a green economy. It also relies on preparing the report on “Advancing Economic Development in Egypt: Reforms for Growth, Jobs & Resilience”, for the transition towards a new economic model based on sustainable growth relying on tradable and exportable sectors with high added value, with the aim of enhancing the productive capacities of the Egyptian economy and creating more productive job opportunities.

Mashat reviewed the pillars of the 2025/2026 plan, pointing to the commitment to applying the concept of priorities to rationalize aspects of public spending and raise its efficiency, stimulate and develop industries and localize local manufacturing, as well as promising industries based on innovation, technical and knowledge progress, which contributes to deepening local manufacturing and maximizing industrial added value. Furthermore, priority is given to human development to achieve the strategic goal of "building the Egyptian human being," which was evident in the pattern of total investment allocations (private and public), where about 700 billion Egyptian pounds were allocated to human development sectors (education, health, and other social services) in the 2025/2026 plan, compared to investments of 447 billion Egyptian pounds in the 2024/2025 plan, an increase of more than 56% at the overall level.

The 2025/2026 development plan allocated about 327 billion Egyptian pounds in public investments to the health, education, scientific research, and other services sectors, representing more than 28% of the total public investments in the same year.

Mashat reiterated that the pillars of the next fiscal year's plan also include all necessary measures to improve the investment climate and stimulate the private sector to conduct business through packages of facilities and incentives encouraging activity and reducing transaction costs.

She noted the ministry's ongoing negotiation and coordination with development partners in providing the necessary financing resources for the private sector under favorable conditions, as these financings reflect the attractiveness of the Egyptian private sector and the success of the structural reforms implemented by the state in increasing private sector investments.

The plan also focuses on efforts to stimulate innovation and entrepreneurship, within the framework of the Ministerial Group for Entrepreneurship, which aims to enhance the capacity of startups and the entrepreneurship ecosystem to achieve sustainable and accelerated economic growth based on competitiveness and knowledge. (MENA)

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