The Minister of Planning, Economic Development, and International Cooperation Participates in the General Session of the House of Representatives to Discuss Financing Development Policies from the World Bank

Dr. Al-Mashat:The government is committed to an annual ceiling for external debt in line with financial sustainability criteria and safe limits set by international institutions.

 

Concessional financing is the least costly tool to support the budget, enabling the state to continue reforms and extend the debt's maturity.

 

Development policy financing is linked to structural reforms that enhance macroeconomic stability, improve the business environment for the private sector, and encourage the green transition.

 

For the first time, concessional financing for the private sector exceeds government financing in 2024.

 

H.E. Dr. Rania A. Al-Mashat, Minister of Planning, Economic Development, and International Cooperation, participated in the General Session of the House of Representatives held today, during which the decision of the President of the Arab Republic of Egypt No. 637 of 2024 was approved. This decision concerns the approval of the agreement for the program "Development Policy Financing for Enhancing Resilience, Opportunities, and Well-being in Egypt" between the Government of the Arab Republic of Egypt and the International Bank for Reconstruction and Development(IBRD), valued at $500 million.

 

H.E. Dr. Al-Mashat was keen to respond to inquiries from the members of the House of Representatives, where she confirmed that Egypt maintains a close partnership with the World Bank and other development partners.

 

H.E. Minister Al-Mashat highlighted that development financing is the least costly form of external financing compared to bonds, international markets, and other commercial loans, as it offers lower interest rates, longer repayment periods, and grace periods. This aligns with the country’s objectives to extend the maturity of external debt.

 

H.E. Dr. Al-Mashat  also noted that the financing is part of the government's efforts to implement the National Structural Reform Program through consistent policies aimed at enhancing the competitiveness of the Egyptian economy, improving the business environment, increasing the economy's resilience to external shocks, and encouraging the transition to a green economy. This is also complementary to the other financing Egypt received from the European Union, totaling one billion euros last year.

 

The Minister emphasized that the government is committed to reduce external borrowing. Through the restructured Debt Committee, chaired by Dr. Mostafa Madbouly, Prime Minister of Egypt. The government monitors compliance with the external debt ceiling and sets an annual borrowing cap based on financial sustainability criteria, aligning with the safe limits set by international financing institutions.

 

H.E. Dr. Al-Mashat pointed out that the government is implementing clear policies to improve the efficiency of public investments and set a ceiling for investment spending. This has contributed to a reduction in concessional development financing received by the government last year, while concessional financing for the private sector increased, surpassing government financing for the first time.

H.E. Minister Al-Mashat indicated that financing for the private sector reached approximately $4.2 billion last year from various international financial institutions and development partners.a