In September, the Egyptian government issued a document entitled “The National Narrative for Economic Development: Policies Supporting Growth and Employment,” laying out a comprehensive vision for the country’s development over the next decade. The plan’s content and the timing of its release, however, suggest that it is less a new beginning than a repackaging of the International Monetary Fund’s approach to Egyptian economic reform that has guided policy since 2016.
The document was published amid increasing doubts among officials and media commentators about the need for yet another IMF program to buoy Egypt’s flailing economy. There has also been growing debate over the possibility of forging an independent path, after a decade of reliance on the global lender—and submission to its dictates—which has left Egypt the world’s third-largest recipient of IMF loans, after Argentina and Ukraine.
Since 2016, Egypt has agreed to four successive IMF loan programs, which together form the framework for far-reaching austerity policies—including the floating of Egypt’s currency, and the slashing of subsidies and public spending. In tandem with other political-economic dynamics, the consequences for Egyptian society have been harsh: poverty rose from 27.8 percent in 2015 to at least 33 percent in 2021, while the wealth and income inequality gap has widened. The richest 10 percent of the population now control two-thirds of Egypt’s wealth and half the national income, while the poorest half owns only 4.2 percent of the wealth and receives 17 percent of the income.
In this context of crisis, the “National Narrative” has departed from the rhetoric of decent jobs and universal welfare while cloaking itself in palatable nationalistic tones. The title of the document links employment to growth, which it portrays as the ultimate goal—ignoring sustainability, equality and distributive justice.
Under this vision, development is reduced to a financial audit that measures success through indicators of deficit and surplus, rather than by improvements in the quality of life of Egyptian citizens.
The IMF’s Intellectual Dominance
Although the document is more than 500 pages long and makes no direct mention of the IMF, the world lender’s fingerprints are clear in at least two key areas: reducing the state’s footprint in the economy in favor of the private sector and centering fiscal discipline as the fundamental framework for economic policy.
The new program continues with the same approach that has characterized the last decade: emphasizing capital-intensive growth accompanied by limited job creation. But if the past is any indicator, this will neither transform the structure of the economy nor create more formal jobs. The National Narrative adopts a neoliberal discourse that prioritizes maximizing the role of the private sector, without establishing safeguards to ensure fairness or transparency in this transformation.
In many chapters, the document repeats the slogan “the private sector is the main driver of economic development.” This reiterates the narrative promoted by the IMF since the Cairo Conference of 2018, when it portrayed state intervention—including through military institutions—as an obstacle to investment. In reality, the private sector already accounts for the largest share of output and employment, but within a non-competitive market dominated by highly profitable monopolies that create few jobs.
Therefore, the discourse of private-sector liberalization is less about expanding competition than about the elite’s repositioning within the economy. While centering the fundamental debate on the state’s withdrawal from economic activity, the National Narrative overlooks any discussion about ensuring that monopolies do not simply shift from the public to the private sector, or about the mechanisms needed to prevent the unchecked power of large, politically-connected corporations.
Far From a ‘Green Transition’
The National Narrative also presents itself as supporting “green” growth, but in reality, it perpetuates a model of pollutive investment. While the government ended energy subsidies for households without any public dialogue or study of how the decision would impact living standards, subsidies have continued to flow to a handful of large companies in refining, fertilizers, cement, iron, textiles, tourism and construction—in short, the most energy-intensive and polluting economic sectors. This skewed redistribution from households to firms keeps the subsidy bill high and distorts investment incentives, favoring capital- and energy-intensive activities over labor-intensive, productive industries.
Moreover, the document fails to address structural problems in Egypt’s investment environment, including the large number of tax exemptions, the lack of a unified investment law, and the ongoing capital outflows. By failing to link investment incentives to the creation of decent jobs, it perpetuates unemployment, precarity and the growth of low-wage informal jobs.
In its most prominent example, the narrative presents the Suez Canal Economic Zone as a model for attracting foreign investment through tax and customs privileges. Yet most of the projects in the zone—including green hydrogen production and vehicle component manufacturing—are located on the Red Sea coast, threatening what remains of a once-rich marine environment already ravaged by mass tourism. Thus, the “transition” is simply a way of “greenwashing” pollutive projects that use the label of sustainability to generate profits for international capital.
Neither Fiscal Discipline nor Social Justice
The National Narrative reproduces the same rigid fiscal logic promoted by the IMF, reducing public finances to narrow accounting procedures and ignoring their fundamental and constitutional role as a tool for achieving social justice.
The document focuses on reducing public debt, achieving a primary surplus and driving a slight increase in revenues through improved tax collection—without any move towards progressive taxation or structural reform of the tax system. Although Egypt’s tax revenue ratio to GDP is under 13 percent—among the lowest in the world for a middle-income country—the document offers no plan to address this structural imbalance or to activate the distributive role of taxes.
Furthermore, it adopts quantitative indicators as its ultimate goals—such as achieving a primary surplus of 3.3 percent, keeping government debt at 81 percent of GDP, and maintaining an average debt maturity of 4.5 years. However, this focus on numbers obscures the fact that Egypt’s debt has not actually decreased in recent years. Rather, it has been circumvented through off-budget borrowing, with the tacit approval of the IMF. As a result, the country’s actual external debt has increased threefold since 2015, yet the annual budget only includes half of it, according to the latest report from the Central Bank.
The government has also relied on high interest rates to attract foreign investment through short-term debt instruments, leaving its finances fragile and vulnerable to collapse whenever those funds are withdrawn. Indeed, three waves of investment outflows over the past decade have led to recurring balance-of-payments crises and sharp currency devaluations. By mid-2025, these outflows added up to more than $40 billion, equivalent to more than four times the Suez Canal’s revenues at their peak, reflecting an economy based on short-term debt rather than productive investment.
More alarmingly, the real problem today is not the size of the fiscal deficit but its allocation. Instead of funding social spending or stimulating decent employment, it is now mainly directed toward servicing Egypt’s debt. Interest payments have risen to 87 percent of tax revenues, while the shares allocated to wages, education and health have shrunk. This leads to the conclusion that “fiscal consolidation” is little more than a slogan, or worse, a reality imposed solely on the average citizen, especially given that Egypt’s budget overall deficit as a percentage of GDP has barely fallen from the level it had hit before the start of the first IMF program. This means that the government has spent billions of borrowed dollars, without the slightest impact on social justice.
A Glimmer of Hope?
In sum, the National Narrative, rather than indicating a break with IMF policies, confirms their continuation. It remains captive to a narrow perspective that overlooks the crises of inequality, tax evasion and unfairness in the distribution of the tax burden.
The government continues to bet solely on monetary policy to achieve stability, while making no real reforms to fiscal policy. In a glimmer of hope, the Ministry of Planning opened a public discussion on the document until the end of November, accepting comments through its website and in meetings with national experts. This dialogue, if conducted seriously and independently, could offer an opportunity to rethink Egypt’s development model and bridge the gap between identifying challenges and formulating alternative solutions. The results of this process are pending.
Despite its conservative tone, the National Narrative implicitly acknowledges the shortcomings of the existing approach. There is still hope that the ongoing discussion will become a platform for redefining development on new foundations that balance economic efficiency with social justice and environmental sustainability.
