The Egyptian Parliament approved on Monday the macro-financial assistance (MFA) agreement signed with the European Commission to secure €1 billion in financial assistance to support the country's macro-fiscal reform agenda and budget. The approval, given in a general session, follows a Presidential Decree No. 400 of 2024 and is part of a broader effort to deepen the strategic partnership between Egypt and the EU, which was elevated during the March 2024 meeting between President Abdel Fattah El-Sisi and European Commission President Ursula von der Leyen in Cairo. Rania Al-Mashat, Egypt's Minister of Planning, Economic Development, and International Cooperation, highlighted that the agreement represents a critical aspect of ongoing cooperation with the EU, focusing on vital structural reforms to bolster the private sector and address Egypt's economic challenges. The €1 billion financing will support Egypt's budget and help the government maintain its reform momentum, while also enhancing the country's economic resilience. The funding is crucial for advancing the necessary structural reforms, which are viewed as essential for unlocking additional private investment and ensuring long-term economic growth, said Minister Al-Mashat. The MFA agreement, signed on 24 July this year, is the first phase of a broader financial assistance package, with a total value of €5 billion to be disbursed by 2027. The macroeconomic support mechanism aligns with Egypt's focus on attracting European investments, particularly in renewable energy, green hydrogen, and food security. Minister Al-Mashat emphasised that Egypt's government is committed to advancing economic reforms, which include streamlining the tax system and expanding social protection networks to ensure a more sustainable future. She also pointed out the significant progress made in structural reforms over the past six months. These include the implementation of electronic payroll tax processing, the activation of the Unified Public Finance Law to limit public debt, and the continued development of Egypt's green transformation, with the adoption of an updated sustainable energy strategy set for completion by September 2024. In a key move to enhance transparency and efficiency, Egypt is also creating a unified database to track state-owned enterprises, ensuring better management of tax exemptions and reducing unnecessary bureaucratic hurdles, the minister added. Attribution: The Egyptian Cabinet
