Egypt’s real GDP growth is projected to reach around 5% in fiscal year (FY) 2025/2026 and 5.3% in FY 2026/2027, before accelerating to 6.2% by FY 2029/2030, according to the Ministry of Finance.
In its Medium-Term Fiscal Strategy covering FY 2026/2027 to FY 2029/2030, the ministry attributed this outlook to the continued expansion of the industrial production base, rising infrastructure investment, the resilience of the tourism sector amid regional and geopolitical challenges, and improved export competitiveness. These developments come against a backdrop of greater macroeconomic stability and the adoption of a flexible exchange rate regime aligned with global and regional economic conditions.
The ministry highlighted non-oil manufacturing as the primary engine of growth, with its contribution to GDP expected to rise significantly over the medium term. The sector recorded real growth of 13.4% in FY 2024/2025, supported by deeper localisation of manufacturing, the expansion of export support initiatives, and targeted incentives for high value-added industries. These measures include interest rate support for loans to productive sectors and dedicated programmes for priority industrial activities.
Tourism is also expected to sustain its strong performance, benefiting from relative regional stability, the launch of major national projects, and the expansion of hotel capacity across key destinations, including the Red Sea and the North Coast. The opening of the Grand Egyptian Museum is expected to further boost foreign currency inflows and employment. In parallel, the communications and information technology sector recorded growth of 14% in FY 2024/2025, driven by increased technological opportunities and the expansion of outsourcing services and digital exports.
According to the Ministry of Finance, the Egyptian economy is set to continue its recovery and structural reform trajectory in FY 2026/2027 despite exceptional regional and global challenges. This momentum is expected to be supported by private investment, foreign direct investment, and stronger contributions from productive and export-oriented industries, alongside the continued implementation of the economic reform programme and progress in state exit plans and partnerships with the private sector.
Fiscal policy over FY 2026/2027 and the medium term aims to balance fiscal discipline with support for economic activity. The ministry said this will be achieved through measures that enhance investor confidence, strengthen productive sectors, and generate sustainable and productive employment opportunities.
Within this framework, the ministry is targeting a continued decline in budget-sector debt indicators, with the aim of reducing the debt-to-GDP ratio to below 70% by 2030. This objective will be pursued through the maintenance of annual primary surpluses, the development of budget revenues—particularly tax revenues—in a growth-supportive manner, and the anticipated easing of interest rates. Additional measures include the use of exceptional proceeds from the state exit programme to reduce debt, the implementation of debt-for-investment swap transactions, and further coordinated actions to reinforce debt sustainability.
The ministry also plans to strengthen budget-sector debt management by diversifying debt instruments and the investor base and extending debt maturities to reduce financing costs and risks. A medium-term debt management strategy will be issued to provide greater transparency regarding the government’s approach.
It noted that reducing debt levels and debt servicing costs remains a central medium-term priority. Budget-sector debt declined from around 96% of GDP in June 2023 to approximately 84% in June 2025, representing a reduction of about 12 percentage points in two years, while external debt of budget-sector entities fell by $4bn over the same period.
The ministry said it will maintain the pace of fiscal and structural reforms and aims to achieve a primary surplus of 4% of GDP in FY 2025/2026, while continuing to support economic growth and expand social spending and investment in human development. The gradual decline in interest rates, supported by easing inflation, is expected to contribute to a reduction in the overall budget deficit from 7.2% of GDP in FY 2024/2025 to around 4.9% in FY 2026/2027, within the framework of ongoing fiscal consolidation.
Achieving these targets will depend on increasing public revenues while keeping primary expenditure, excluding interest payments, under control as a share of GDP. The ministry aims to raise tax revenues by around 1% of GDP annually during the current and next fiscal years, bringing tax revenues to about 14.4% of GDP in FY 2026/2027 and further to approximately 15.2% by FY 2029/2030, a level close to the lower bound typically observed in emerging markets.
This will be supported by the continued implementation of tax reform and facilitation packages to broaden the tax base, with priority given to measures that have a limited impact on inflation. The Ministry of Finance is currently finalising a medium-term tax policy document to provide greater clarity and direction for tax policy.
Interest payments as a share of GDP are expected to decline as a result of tighter control over debt levels and lower interest rates in an environment of easing inflation.
The government will continue to prioritise spending on health, education, and social protection, while supporting key sectors to improve basic service provision and increase development spending, with the aim of delivering tangible improvements in service quality.
The ministry added that ongoing structural reforms, tax facilitations, investment-friendly policies, export support initiatives, sector-specific programmes, expanded public–private partnerships, and the utilisation of infrastructure developed in recent years are expected to raise growth to at least 5–6% over the medium term. This growth will be driven by private investment, non-oil export expansion, and the creation of employment opportunities capable of absorbing new labour market entrants, alongside continued progress in reducing inflation and a gradual decline in average interest rates on new treasury bill and bond issuances.
The Ministry of Finance issued its Public Finance Strategy on Sunday, which serves as the foundation for preparing the FY 2026/2027 budget and the medium-term budget framework. The strategy was issued in line with the Unified Public Finance Law No. 6 of 2022 and its amendments under Law No. 18 of 2024, which require the ministry to propose the state’s general fiscal policy directions through an annually updated strategy reflecting economic developments and national priorities.
The Public Finance Strategy complements other government economic reports outlining policy orientations and medium-term programmes and also serves as the preliminary financial statement for the state budget. Through this framework, the government aims to enhance economic performance, preserve stability and competitiveness, attract domestic and foreign private investment, and deliver tangible improvements in living standards.
