Egypt aims to achieve an economic growth rate of 5.2% during the coming fiscal year, according to the financial statement for the fiscal year (FY) 2016-2017 budget that was discussed during Minister of Finance Amr Al-Garhi’s speech on Sunday at the House of Representatives.
During the FY 2014/2015, Egypt achieved an economic growth rate of 4.2%. According to the minister, that government is optimistic about reaching a 6.2% economic growth rate by FY 2019/2020.
Economic growth relies on Egypt renovating and developing its various economic sectors, with a focus on reviving tourism.
“Egypt started implementing the plan to achieve its ambitious 2030 vision,” said Minister of Planning Ashraf El-Araby before parliament on Sunday.
He added that the initiative put forward by the Central Bank of Egypt (CBE) to encourage banks to fund small- and medium-sized enterprises (SMEs), allocating the required funds and reforming the laws and regulations in regard to such projects will be one of the means necessary for achieving the targeted outcome.
El-Araby explained that Egypt aims to attract 10 million visitors in an effort to restore the tourism sector by using a new marketing strategy to reposition Egypt as a major touristic destination.
But this ambitious vision collides with the Ministry of Finance’s decision to exempt banking services provided by banks operating in the Egyptian market from the value-added tax (VAT), while banks themselves still await for further clarification on the vague matter and whether the decision will exempt banks from paying VAT or only registration.