Egypt’s Minister of International Cooperation Rania Al-Mashat has presented the country’s success in achieving economic growth in the Middle East and North Africa (MENA) region during her participation in the “Policy Makers Brief” organised by the HSBC’s Global Emerging Markets Forum.
The minister referred to the recent “Regional Economic Prospects” report on Egypt’s economy, issued by the European Bank for Reconstruction and Development (EBRD), to highlight her remarks.
The EBRD report indicates that Egypt is the only economy among the country’s in which the bank operates to avoid a recession, achieving 2% growth in 2020. It is expected to rebound to 5% in 2021, due to of the government’s infrastructure projects and structural reforms that readied the economy for crises such as the ongoing global pandemic’s impacts.
Minister Al-Mashat highlighted Egypt’s ‘Response and Rebuild’ strategy, which was based on three pillars: protect, provide and progress. It focuses on protecting the population from the virus, providing easier access to credit to help smooth consumption in households, as well as liquidity for firms to survive the disruption. The strategy also aims at pushing progress forward by expediting structural reforms through and beyond COVID-19.
To provide essential protective equipment and other supplies, medical supplies and other services, the president approved an EGP 100bn allocation to confront the pandemic. Of this amount, EGP 188m was allocated to the Ministry of Health.
Wages and bonuses of doctors and medical staff increased, and a periodic allowance of 7% has been approved for public sector employees subject to the Civil Service Law. A 12% bonus has also been approved for state employees who are not subject to the Civil Service Law. In addition, an additional incentive has been granted to all workers and employees ranging from EGP 150 to EGP 375 per month to improve their standards of living.
To support the private sector and ensure economic progress, interest rates were lowered by 300 basis points, and real estate tax instalment payments imposed on factories and tourism establishments were postponed for a period of three months.
The Central Bank of Egypt (CBE) and the Ministry of Finance have taken a number of measures to encourage financial inclusion and enable citizens to complete their banking transactions remotely.
Minister Al-Mashat added that multilateral international cooperation played a role in mitigating the impact of the pandemic in Egypt, as evidenced by the digital education programmes which allowed students to complete the school year remotely.
These came in addition to other programmes that supported the health sector and social inclusion through the Takaful and Karama initiatives.
The minister noted that the Ministry of International Cooperation is working, through the principles of economic diplomacy, to strengthen the ‘Global Partnerships for Effective Development’.
These principles include regularly organising multi-stakeholder platforms to ensure that all projects between development partners are streamlined and effectively coordinated. These take on board the adoption of a consistent Global Partnerships Narrative including People&Projects&Purpose (P&P&P). They also include mapping ODA financing to the UN’s sustainable development goals (SDGs) for all projects with multilateral and bilateral development partners.
Minister Al-Mashat stressed that multilateral cooperation is essential to achieving faster recovery for all, as “global problems require global solutions”. These include strengthening climate action, ending hunger and poverty, and addressing gender inequalities.
She referred to an example of cooperation through the WEF’s regional action group, where she joined a group of senior decision-makers from the government, businesses, and civil society. As part of the meeting, they designed a new roadmap that applies the principles of stakeholder capitalism for the MENA region, which aims to push for an inclusive, sustainable, and resilient recovery for the region.