Ministry of Planning Enhances Methodology for Calculating Private Investment within National Accounts System

The Ministry of Planning and Economic Development announced today the development of the methodology for calculating private investment within the national accounts system. This significant step underscores the ministry’s unwavering commitment to the continuous enhancement of the country’s national accounts framework.

Dr. Hala El Said, Minister of Planning and Economic Development, highlighted that the ministry collaborated with esteemed international experts and various entities, including the Investment Authority, Free Zones Authority, Commercial Registry, Capital Market Authority, and financial and business associations, in developing this methodology. Over the course of two years, through a series of workshops and expert meetings, these efforts have culminated in the refinement of the methodology to accurately capture the dynamics of private investment in Egypt’s economy.

The revised methodology takes into account the improvement of estimating investment in the informal private sector and incorporates comprehensive data on investment in research and development. Special emphasis has been placed on sectors such as electronics, software, and technological infrastructure development, which have experienced significant growth, particularly in the aftermath of the COVID-19 pandemic. Additionally, household expenditure on residential buildings and maintenance and repair of homes has been integrated into the methodology.

Dr. El Said underscored that the objective of this initiative is to provide more precise data on the size and sectoral distribution of private investment, thereby enabling the creation of a realistic investment map across various economic sectors.

Following the implementation of this new methodology, private sector investment in Egypt has been recalculated at 499.2 billion Egyptian pounds for the fiscal year 2022/2023, representing a substantial increase from previous estimates. This adjustment elevates the share of private investment in the total investment to 36.4%, up from 25.5%. Furthermore, preliminary figures indicate that private investment in the first quarter of the fiscal year 2023/2024 amounted to approximately 154 billion pounds, with total private investments expected to reach around 600 billion pounds by the end of the fiscal year.

Looking ahead, one of the key objectives of the economic and social plan for the upcoming fiscal year is to elevate the share of private investment to 50% of total investments for the year 2024/2025. This strategic direction aligns with the state’s vision for economic reform and development, as outlined in Egypt Vision 2030.