The Egyptian Cabinet approved the state budget for the 2026/2027 fiscal year following a meeting on March 26, 2026. Finance Minister Ahmed Kouchouk described the budget as a pivotal step that prioritizes citizen welfare while fostering a more competitive environment for investors.
The plan is built around four key policy pillars designed to balance fiscal discipline with economic stimulus, with health, education, and social protection identified as top expenditure priorities.
During a press conference on March 28 attended by the Prime Minister and ministers of Planning, Information, Electricity, and Petroleum, Minister Kouchouk outlined the government’s strategic approach.
Macro-Fiscal Targets and Debt Management
The 2026/2027 budget sets ambitious fiscal targets aimed at long-term financial stability. Total public revenues are projected to increase by 27.6%, reaching approximately EGP 4 trillion (≈$74.74 billion) while total spending is set at EGP 5.1 trillion (≈$95.28 billion), a 13.2% rise.
The government is targeting a primary surplus of EGP 1.2 trillion, equivalent to 5% of GDP, to support debt reduction and social protection measures. The budget also aims to reduce the total deficit to 4.9% of GDP and lower the debt-to-GDP ratio for budget sector agencies to 75.5% by June 2027.
Social Protection and Human Capital Investment
The budget includes a major commitment to improving the quality of life for Egyptians. Social protection programs have been allocated EGP 832.3 billion, representing 12% annual growth, aimed at supporting the country’s most vulnerable groups.
Health and education stand at the forefront of the 2026/2027 development plan, with strategic allocations designed to fulfill constitutional obligations and catalyze investment in human capital. To this end, the government has earmarked 48% of public treasury funding specifically for these sectors
Economic Stimulation and Industrial Support
To drive industrial growth and strengthen the “real economy,” the budget allocates EGP 90 billion to support economic activity. Incentives are tied to measurable results, with priority given to programs promoting local industry and reducing import dependence.
Additional funding is earmarked to boost export competitiveness and support tourism, ensuring these sectors continue to generate foreign currency revenue.
Structural Reforms and Private Sector Engagement
The 2026/2027 budget outlines a roadmap for structural and administrative reforms to promote sustainable growth. A mandatory annual ceiling on public investments is intended to expand private sector participation and improve the investment climate. Building on the first package of tax incentives, a second package will simplify the tax system, encourage voluntary compliance, and strengthen trust with businesses. The budget also moves toward a “Programs and Performance” approach, linking public funds to measurable development goals.
The budget is part of a medium-term framework extending through FY 2029/2030. Real GDP is projected to grow from 5.3% in 2026/2027 to 6.2% by 2029/2030, while inflation is expected to fall from 11.5% to 7.5%. The government aims to reduce the debt of budget sector agencies to roughly 68% of GDP by the end of FY 2029/2030.
