The Egyptian government has approved a budget allocating 4.6 trillion Egyptian pounds ($91.05 billion) for the 2025/26 fiscal year, according to a government statement released on Wednesday. The budget reflects an 18% increase in government spending as the country seeks to recover from its ongoing economic difficulties.
A significant portion of the budget is allocated to social support, with a 15.2% increase in grants, subsidies and welfare programs. This includes a 20% increase in bread subsidies aimed at helping low-income households. The decision follows a series of financial relief measures introduced during Ramadan and Eid al-Fitr.
Despite concerns from international financial institutions such as the International Monetary Fund (IMF) about Egypt’s heavy spending on subsidies, many economists and activists argue that such spending is vital to preventing food insecurity, especially given the country’s growing population.
The government is forecasting revenues of 3.1 trillion Egyptian pounds for the 2025/26 fiscal year.
According to the Ministry of Planning, economic growth has improved, with Egypt’s GDP rising by 4.3% in the second quarter of 2024/25, compared to 2.3% in the same period the previous year. The growth was driven by increased investment and strong performances in non-oil production, which increased by 17.74%, and tourism, which increased by 18%.
However, some sectors faced declines. Activities in the Suez Canal contracted sharply by 70%, while extractive industries also struggled. Oil extraction fell by 7.6%, gas extraction fell by 19.6%, and overall extractive sector growth fell by 9.2%.
Egypt’s fiscal year began on July 1, with the government aiming to balance economic expansion with social support while addressing structural challenges in key industries.