Minister of Finance Hany Kadry Dimian, who was reappointed as finance minister early Saturday, announced that the ministry’s focus will be on bridging the production gap for goods and services as well as achieving sustainable development.
The minister stated that the coming period would not only include legislative changes within the economic system, but would breathe new life into the administrative and governmental system.
The minister added that the focus of investment will be on the private sector. He pointed out that there are good indicators which confirm the increase of bank credit to the private sector, which recorded 17% in fiscal year FY 2014/2015.
Dimian added, however, that the cost of investment in Egypt is high as a result of higher funding costs.
The minister’s statements did not address any change in the tax plan. Prior to the Euromoney conference, which was held early September, Dimian mentioned that the government is seeking to implement a fully fledged value added tax (VAT).
The VAT will not influence the prices of food commodities, the minister had said..
“The government expects the tax to increase the prices of products, except for food commodities, by 1.3% or 2.6%,” he said in a previous interview with Daily News Egypt. “The International Monetary Fund [IMF] was selected as an unbiased entity to measure the effect of inflation, and it found that it will result in a 1.3% price increase.”
“The spending of the lowest 10% will increase from an average of EGP 1,207 to EGP 1,213, with a 0.5% increase,” the minister added.
The difference in spending of the tranche will increase by an average of EGP 15 per month, to EGP 48 per month.