The Ministry of Planning and Economic Development has announced a new approach to evaluating private sector investments, revealing that both the amount and proportion of private investments in Egypt are rapidly increasing.
In its pursuit of strengthening the national accounts system, the Department has developed new methods to quantify private investment. The initiative is part of a broader effort to refine Egypt’s gross domestic product (GDP) figures, updating the results of the 2017-2018 Economic Census and increasing production from 1981-2023. This includes extending the time series. The update includes detailed sectoral and expenditure data. Consistent with the latest global standards for national accounts.
Minister of Planning Hala El Said reported that the Ministry worked with top international experts and various institutions such as the Investment Authority and the Free Zones Authority to improve investment calculation methods. His two-year project included numerous workshops and consultations with experts.
The revised methodology improves the accuracy of informal sector investment estimates and integrates comprehensive data on R&D investments. This is especially true for high-growth industries such as media, electronics, software, and technology infrastructure, which have seen significant expansion post-COVID-19. This method also takes into account household expenditures on home construction and home maintenance.
Minister El-Said emphasized that the aim is to provide accurate data on the scale and sectoral spread of private investment, thereby creating an accurate depiction of economic activity across different sectors.
With the introduction of this new method, the recalculated figures show an increase in private investment in Egypt. The estimated value for the 2022/2023 financial year is EGP 499.2 billion, a significant increase from the previous estimate of EGP 298.5 billion. As a result, the share of private investment in total investment rose from 25.5% to 36.4%. Private investment in the first quarter of the 2023/2024 fiscal year amounted to approximately EGP 154 billion, exceeding the initial estimate of EGP 114 billion. By the end of the 2023/2024 financial year, private investment is expected to amount to approximately EGP 600 billion.
The economic and social plan for next year includes increasing the proportion of private investment to 50% of total investment by 2024/2025. This strategy is in line with sovereign directives and supports the goals of the structural economic reform program in line with Egypt’s new vision for 2030.
