Dr. Narmin Tahoun: The Primary Surplus of 3.1% of GDP Reflects a Significant Improvement in Public Financial Management Efficiency

Dr. Narmin Tahoun, economic expert, affirmed that achieving a primary surplus of 3.1% of GDP during the period from July 2024 to April 2025 is a strong indicator of improved public financial management and enhances confidence in the government’s commitment to the path of economic reform.

She noted that this surplus — the highest in Egypt’s history — amounts to nearly EGP 600 billion and comes at a highly sensitive time marked by global inflationary pressures and declining capital flows to emerging markets.

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Dr. Tahoun explained that this achievement was made despite a decline in revenues from key sectors such as the Suez Canal and the petroleum sector. Canal revenues, in particular, dropped by nearly 40% in the first quarter of 2025, which highlights the effectiveness of fiscal policies in compensating for lost revenues through improved tax collection and controlled public spending.

She emphasized that this surplus enhances the state’s ability to fund essential expenditures without resorting to borrowing to finance the current deficit, thus contributing to reducing pressure on public debt — which remains a major challenge, as debt servicing costs are estimated to account for over 50% of public spending in some estimates.

While commending the results, Dr. Tahoun stressed that “achieving a primary surplus is a positive step, but the key is to sustain it.” She added that the government must strike a careful balance between fiscal discipline and stimulating economic growth, especially since the current growth rate — estimated between 3.5% and 4% — remains below long-term targets.

She concluded by saying that the next phase must focus on deepening local production, attracting foreign direct investment, and expanding the social safety net to ensure that positive indicators are reflected in the quality of life for citizens — not just in macroeconomic figures.