Egypt’s Private Sector Investments Surge by 73% in Last Fiscal Year

Egypt’s Private Sector Investments Surge

Recent data reveals a 73% increase in private sector investments in Egypt in the last fiscal year. According to Ahmed Kouchouk, the country’s Minister of Finance, the private sector has emerged as the principal source of investment within the country.

Growth Rate of Egypt’s Economy Exceeds Expectations

In a virtual meeting with investors, organized by FIM Partners – a notable asset management firm, Kouchouk revealed that Egypt’s economy grew by an impressive 4.4% in the previous fiscal year, which concluded in June. This positive growth, exceeding initial projections, was attributed to stellar performance in the manufacturing, tourism, and information technology sectors.

Boost in Investor Confidence in Egypt’s Economy

Expressing his views in an official ministry statement, Kouchouk posited that the Egyptian economy has started to win back investor trust, and is on track to becoming an enticing investment hub with a myriad of competitive opportunities. The finance minister also highlighted the positive impact of economic and financial reforms, which have led to a primary surplus of 3.6% of GDP, despite various challenges.

Major Reduction in Egypt’s Budget-Sector Debt

Kouchouk announced that the debt of Egypt’s budget-sector entities, as a percentage of GDP, was trimmed by 10% over the span of two years, and the external debt of the budget sector was cut down by roughly $4bn. Additionally, the country saw a 35% surge in tax revenues during the last fiscal year, without the introduction of new taxes. This was largely attributed to increased economic activity and an expanded tax base.

Increased Foreign Direct Investment and Remittances

Foreign direct investment leaped to around $12.2bn during the same fiscal year, with a diversified spread across various sectors. Moreover, remittances from Egyptians residing abroad jumped 66% to $36bn. Kouchouk also shed light on the improved levels of net foreign assets, and declining inflation rates, which permitted a recent interest rate cut.

Egypt’s Recent Moves to Reduce Debt

“Our present focus is on converting a significant portion of deposits from Arab nations and debt from several other countries into investments in a bid to drastically reduce debt,” said Kouchouk. He added that early indicators for the first quarter of the current fiscal year demonstrate continued significant improvement and the tangible benefits of financial and economic reforms, with the primary surplus exceeding 170 billion Egyptian pounds and continuous decline in government debt.

Positive Perception of Egypt’s Economic Outlook

Kouchouk concluded by pointing out the shifting perception of markets and international rating agencies, which are beginning to view the Egyptian economy in a more positive light, providing a comprehensive picture of the country’s ongoing economic development.