Egypt is preparing to issue domestic Sukuk within the first half of the 2025/2026 fiscal year, according to Finance Minister Ahmed Kouchouk. The announcement was made during a panel discussion hosted by Al Ahly Pharos Securities Brokerage, where the minister explained the country’s financial roadmap for the new fiscal year.
Sukuk, often called Islamic bonds, are financial instruments that comply with Islamic Sharia law. Instead of paying interest like conventional bonds, Sukuk investors earn returns generated by assets or projects tied to the instrument. In many countries, Sukuk has become an important tool for governments to raise funds for infrastructure, development, and other projects while appealing to both local and foreign investors who prefer Sharia-compliant products.
Kouchouk noted that the government is approaching the fiscal year with an integrated strategy designed to reduce debt levels and extend debt maturities. He stressed that this is part of a bigger plan to ease financial burdens while still ensuring steady economic growth. According to him, the Ministry of Finance is also working closely with the Ministry of Planning to boost development financing by partnering with international institutions and foreign investors.
The Finance Minister highlighted positive indicators in Egypt’s general budget, describing them as evidence of the country’s ability to attract new investment flows. He pointed out that in the third quarter of the previous fiscal year, Egypt recorded a growth rate of 4.7%. This performance was driven largely by an impressive 80% increase in private sector investments during the first nine months of that year.
Kouchouk explained that the government’s decision to bet on the private sector has paid off. The results have been visible in many areas of the economy, including industry, tourism, telecommunications, and information technology. Exports from these sectors have also grown significantly, rising by about 30%. He said this strong private sector performance is now central to Egypt’s financial stability and economic outlook.
Another key achievement highlighted by the minister is the country’s primary surplus. Egypt recorded its highest primary surplus of 3.6% of GDP in the previous fiscal year. This achievement came despite external challenges such as reduced revenues from the Suez Canal and a slowdown in the energy sector. The primary surplus is considered one of the strongest signals of Egypt’s ability to maintain fiscal discipline while still growing its economy.
On tax revenues, Kouchouk revealed that the government was able to increase tax collections by more than 35% without introducing new taxes or placing additional burdens on citizens and businesses. He said this improvement reflects better compliance, reforms in tax administration, and stronger economic activities.
He further disclosed that the government is preparing to launch a second package of tax incentives targeted at the private sector. These incentives are meant to build stronger partnerships with local and international businesses, create room for expansion, and support investors in different industries. As part of this plan, the Ministry of Finance is also working on a more integrated and efficient tax system to speed up the refund process for Value Added Tax (VAT).
According to Kouchouk, Egypt is determined to continue implementing balanced fiscal policies that encourage growth while maintaining financial stability. He emphasized that reforms would not stop, as the government intends to innovate more tools for financing, saving, and investment. By doing so, Egypt hopes to expand economic activity, create jobs, and strengthen investor confidence.
The issuance of domestic Sukuk in the coming months is expected to provide the government with additional funding options while attracting new categories of investors. Experts say this move will deepen the country’s financial markets, diversify sources of government revenue, and reduce reliance on traditional borrowing methods. It also reflects Egypt’s strategy of positioning itself as a hub for Islamic finance in the region.
As the first half of the fiscal year unfolds, all eyes will be on how Egypt structures the Sukuk issuance and how investors respond to the offering. With growing demand for Sharia-compliant instruments globally, Egypt’s domestic Sukuk could play a major role in financing national projects while boosting the economy.
