There is no doubt that Egypt is not isolated from the massive economic challenges that have impacted the world in recent years. The successive shocks that have shaken the global economy, leading to a shortage of international liquidity, an unprecedented rise in debt, a decline in foreign currency reserves, and disruption in the Stock Exchange market — all have raised uncertainty to exceptionally high levels. Consequently, the state has drawn up flexible plans for economic development in line with Egypt Vision 2030.
Last week, Minister of Planning and Economic Development Hala el-Saeed presented before the Senate the main features of the Socio-economic Plan Document for the coming fiscal year 2023-2024. The drafting of this plan has taken into consideration full commitment to the goals of the National Strategy for Human Rights.
The plan revolves around five main axes, the first of which focuses on industry, agriculture, and communications in order to increase the resilience of the economy against external shocks.
The plan also seeks to increase private-sector participation through the State Ownership Policy Document, which is partly intended to attract investors. The document guarantees competitive neutrality and identifies the sectors from which the state will dissociate.
Furthermore, the plan seeks to benefit from youth, who make up 60 per cent of population, to meet the needs of the labour market. Within this framework, there is currently co-ordination between the ministry of education and that of higher education to grant technical and technological schools international accreditation and enable more graduates in skills that are in high demand in the labour market.
The plan also focuses on social protection schemes, such as the Decent Life initiative and the National Project for Developing the Egyptian Family. The socio-economic development plan for 2023-2024 estimates economic growth at 4.1 per cent compared with 4.2 per cent in the previous year. Such estimates are similar to those by all international financial institutions which forecast Egypt’s growth rate between 4 and 4.3 per cent in 2022-2023 and 2023-2024 respectively. The plan envisages an LE11.84 trillion Gross Domestic Product (GDP), compared to the expected LE9.8 trillion in the previous year.
Economic reforms enacted by the state since 2016 have contributed to public protection to a large extent against the negative repercussion of the global economic crises. The socio-economic development plan 2023-2024 targets economic growth of 4.1 per cent, a reduction from the previously 5 per cent projection in line with revised IMF and World Bank forecasts which expect growth rate to be between 4 and 4.3 per cent for FY 2022-23 to FY 2023-24.The 4.1 per cent growth rate is less than the previously expected 5 per cent due to the negative economic impacts of the war in Ukraine, it higher than that in many other countries.
The plan puts into account how to control the rise in unemployment and relieve the effects of inflation by slowing down the implementation of certain infrastructure projects at this difficult time and at the same time focusing on agricultural investment to achieve self-sufficiency in supply chains.
Although Egypt is not immune to successive global economic shocks, the thoroughly-studied plan designed by the state makes us hopeful for the future.
Mohamed Fahmy is the editor-in-chief
of The Egyptian Gazette and
Egyptian Mail newspapers
