Domestic savings to be main driving force of Egypt's development

In line with the continued efforts to provide the needed impetus to Egypt's socio-economic development plan, experts viewed that increasing the domestic savings rate to 25 percent of the Gross National Product (GNP) is considered as one of the main pillars of such a plan.

Within this context Minister of Planning Osman Mohammed Osman recently asserted that in order to realize the plan's targeted growth rate estimated at 4.5 percent, more savings are required in this concern.

"Egypt's domestic savings rate currently ranges between 15 to 17 percent, still below the aspired level, a matter which necessitates strenuous efforts to bridge the gap between financing needs and saving capacities, rating 7 per cent," Osman added.

Based on the same premise, the Minister of Planning asserted that the insurance sector comes among the effective instruments for mobilizing savings and channelling them into various investment sectors, hence serving as a main driving force of development.

For this reason, Osman confirmed that increasing the average of domestic savings requires upgrading the performance of the insurance companies and expanding their marketing capabilities.

This also necessitates extending more insurance services, enhancing insurance awareness and expanding the volume of subscriptions.

To experts, banks and insurance companies are the main wings of investment, together with other instruments such as the "stocks exchange and the investment funds.

Hence, enhancing savings rate mainly hinges on upgrading the performance of these aforementioned sector to pool their investments, thus pushing forward the wheel of development.

On the same note, Egypt's commitments to ensure its economic worthiness and merge into the global economy are notably manifested in the ratification of four important agreements this week between Egypt and the donor countries.

Under these agreements, Egypt will receive a sum of $ 550 million as a first batch of a total of $ 10.3 billion which were agreed on during the Sharm El-Sheikh Donors Conference last February.

The four agreements were previously signed by Egypt with Denmark, Japan, the Arab Development Fund and the Kuwaiti Fund for Economic and Social Development.

Within this context, Prime Minister Atef Ebeid laid emphasis on the distinctive and strong relationship between Egypt and the international financing corporations.

Egypt and the World Bank maintain full understanding, Ebeid said, noting that cooperation is underway on conducting studies on Egypt's economy pertaining to measures for maintaining social security, expanding the private sector's role and sustaining trade deregulation drive.