On behalf of the Minister of Planning and Economic Development: Deputy Minister of Planning inaugurates the ceremonial launch of the fifth edition of the Arab Development Report

Dr. Ahmed Kamali, Deputy Minister of Planning and Economic Development, on behalf of Dr. Hala El-Said, Minister of Planning, inaugurated the ceremonial launch of the fifth edition of the Arab Development Report entitled “The Indebtedness of Arab Countries: Reality, Risks, and Ways of Confrontation”, in cooperation between the Institute of National Planning and the Arab Planning Institute in Kuwait.
Dr. Ahmed Kamali said in his speech on behalf of Dr. Hala El-Said, Minister of Planning, that the fifth edition of the Arab Development Report discusses a pivotal development issue, which is: (The indebtedness of Arab countries: reality, risks, and means of confrontation). Kamali explained that the issue of indebtedness is linked to the broader issue of development in its various dimensions, especially concerning providing the necessary funding for development projects and programs.Kamali pointed out that, as is well known, developed and developing countries alike often resort to debt as one of the sources of financing the development process due to the insufficiency of domestic savings in exchange for the increasing needs of investment and public spending requirements.Kamali added that the international framework of indebtedness indicates its development at the global level in the wake of the global financial crisis and until 2019 when the volume of global indebtedness at the level of all economic sectors increased during the last decade to reach $ 255 trillion, equivalent to three times the global GDP for the same year.


Kamali added that according to the World Bank's 2022 World Debt Statistics Report, the total external debt of the Middle East and North Africa countries amounted to $370 billion in 2020, compared to about $350 billion in 2019, which undoubtedly resulted from countries having to borrow to deal with the effects resulting from the Corona pandemic. Kamali explained that for the Arab countries, one of the important indicators included in the report is that despite the increase in the absolute value of the indebtedness of Arab countries with an average growth rate of 6% annually, the ratio of this indebtedness to the gross domestic product decreased from 47.5% in 2005 to only 43.5% in 2018.Kamali added that the Arab countries faced many development challenges that led to additional burdens in the levels of indebtedness as a result of the repercussions of the Corona pandemic, as there was a significant increase in the volume of borrowing, and most countries resorted to adopting broad packages of fiscal stimulus, which led to the expansion of many of them in Borrowing, to compensate for the acute shortage of foreign exchange resources.Kamali highlighted that one of the proposed treatments for effectively dealing with the debt issue, as indicated by the report in the case of the Arab world, is the need for more structural reforms, particularly in the areas of increasing revenues and the value of exports, especially in productive sectors such as manufacturing industries, agriculture and any other sectors that distinguish countries from others.Kamali explained that there is a need to achieve fiscal discipline in addition to the need to implement structural reform that supports growth, by controlling the levels of the budget deficit and public debt, and mobilizing and collecting public resources on the one hand.Kamali referred to Egypt's experience, which began to bear fruit in implementing proposals to address the debt problem and its positive repercussions on the indicators of the Egyptian economy, reviewing the most important features of the experience through the implementation of the structural reforms program within the national program for economic and social reform.Kamali added that the state is completing these reforms through the implementation of the National Structural Reform Program, which aims to transform the Egyptian economy into a productive, knowledge-based economy that enjoys competitive capabilities in the global economy.Kamali noted that in parallel to the structural reform efforts, the state is working through the Ministry of Planning to improve the management of public investment in a way that maximizes the use of available resources.


Kamali explained that to achieve this, the ministry was keen, through the plan for the year 21/2022, to continue the boom achieved in public investments, as the volume of public investments in this year was estimated at EGP 933 billion, representing 75% of the total investments, and an increase of 535% compared to the year 2015/14.
The year 21/2022 also witnessed, for the first time, total investments exceeding EGP 1 trillion barriers, confirming the government's determination to pump huge investments to move the economy at an accelerating pace.Kamali added that public investments played a catalytic role in advancing economic growth, as upward growth rates were achieved in the past five years, reaching 5.6% in the first half of 19/2020, before the impact of the repercussions of the Coronavirus, which negatively affected all economies of the world. Kamali explained that despite the crisis, the Egyptian economy achieved a growth rate of 3.6% during (19/2020), driven by the catalytic role played by public investments in reducing the negative repercussions of the pandemic. Egypt was among a limited number of countries in the world that achieved positive growth in light of the pandemic, as the growth rate reached 3.3% in 20/2021, and the growth rate is expected to range between 5.5 and 5.7% in 21/2022.Kamali also stressed that the state is also working to raise the efficiency of public spending through some mechanisms, the most prominent of which included the expansion of the application of "plans and budgets for programs and performance" and the development of legislative and institutional frameworks that guarantee the success of the experiment.On the institutional side, Kamali explained that a unit for the programs and performance plan was established in the Ministry of Planning and Economic Development, and another unit in the Ministry of Finance.Kamali added that the mechanisms also included raising the efficiency of the state's investment spending through the "integrated system for preparing and following up the investment plan", which represents a qualitative leap in the process of preparing and following up the investment plan through electronic connectivity, and through the three components of the system.Kamali indicated that the Ministry of Planning and Economic Development is training the authorities at the level of the Republic on how to use the three components of the system, explaining that the final stages of linking the integrated system on the one hand and the Ministry of Finance's financial information system and investment bank databases, on the other hand, are being completed.


Kamali added that the ministry also provided training to the authorities on how to prepare development feasibility studies for projects, intending to raise the efficiency of the state's investment spending, as well as launching a "performance" system to monitor and evaluate government performance through specific development performance indicators that measure the level of achievement achieved in all government programs. The system is the first of its kind in the history of Egypt, in addition to the development of a "financing equation" to ensure a fair distribution of public investments at the governorate level, taking into account the treatment of development gaps between Egyptian governorates.Kamali stressed that the state is working hard to diversify the sources of financing development plans and programs, by expanding the funding base in partnership with the private sector and regional and international sovereign funds. Kamali pointed to the establishment of Egypt's Sovereign Fund (TSFE) in 2018 to increase investments, diversify sources of financing for sustainable development goals, optimize the use of state assets and resources, and achieve sustainable financial surpluses through a balanced and diversified portfolio.He pointed out that the fund established four sub-funds in the areas of "diverse health services, infrastructure, financial services, and digital transformation, tourism, and real estate investment."Kamali added that the state considers maximizing participation between the public and private sectors in various fields of investment as one of the main catalysts for promoting sustainable development, and therefore it is working to strengthen the legislative framework supporting partnership by making amendments to the law regulating private sector participation in infrastructure projects, services, and public utilities, where it was approved Those modifications last month.Kamali pointed to Egypt's launch of green bonds as the first country in the Middle East and North Africa (MENA), to diversify sources of funding and in line with the Egyptian state's orientation towards a green economy, especially with its hosting of the Conference of the Parties to the upcoming United Nations Climate Change Convention COP27.Kamali also dealt with the talk about Egypt's work now to issue a national report on "Finance for Development", which is the first report of its kind at the national and international levels, and it is the first report that deals with all dimensions of financing for development at the level of a country, which is due to be issued The beginning of next year and comes in cooperation with the Arab League and the United Nations.