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Government targets reducing public debt to 70% within four years: Mohamed Moeit No new taxes to be imposed over next four years, IMF mission to visit Egypt in October, says finance minister
Egypt targets to decrease the GDP to debt rations to 92% in the fiscal year (FY) 2018/19, reduce public debt to 70% within a four-year period, achieving 14% inflation rate, and lowering the unemployment rate below the 10% mark, said Minister of Finance Mohamed Moeit on Wednesday. Moeit's remarks came during his meeting with the French Chamber of Commerce and Industry in Egypt headed by Mahmoud El Kaissy. The minister stressed that the economic reform programme, helped the Egyptian economy to be able to absorb all foreign crises. Adding that since 2016 the net foreign reserve rose from $13bn to reach $44.4bn now, while the budget deficit fell to 9.8% in June down from 16.7% in FY 2013/14. Moreover, Moeit said that in FY 2017/18 the country achieved 5.4% GDP growth and that 5.8% is expected this year. Explaining that to Egypt needs a growth rate of between 7-8% to maintain its standard of living taking into consideration the high population growth rate. In regards to debt instruments, the minister explained that Egypt is facing challenges, in terms of high interest rates, foreigners' liquidation and market exit, whether in government financial instruments or the stock market. Adding that, "local debt instruments – including T-bonds – auctions will be cancelled as long as interest rates remain high, stressing that Egypt has other alternatives to get liquidity." Moreover, the IMF mission to arrive in mid-October to conduct a periodic review of the economic reform programme, he announced, additionally a technical team from the IMF is expected to arrive in Egypt during the coming period to provide technical support in the formulation of an integrated tax strategy in the country. "The government had no intention of increasing taxes over the next four years," Moeit stressed. The minister revealed that amendments are being made to the current income tax law and that a new real estate tax law is being prepared, to eliminate the differences in the value of the tax, reduce the real estate tax burden on the manufacturing sector. He pointed out that the ministry has completed the preparation of a simplified draft tax treatment for small and micro enterprises, to ease the process of integrating the informal economy.
