Ahmed Kamel – Egypt Daily News
Egypt’s government has announced an indefinite freeze on electricity price hikes, a move aimed at preventing a resurgence of inflationary pressures as the country continues its efforts to stabilize the economy and ease the burden on households and businesses.
Prime Minister Mostafa Madbouly made the announcement during a press conference on Wednesday, emphasizing the government’s commitment to protecting vulnerable segments of society and keeping inflation in check. “At this stage, there are no plans to raise electricity prices. Our priority is to control inflation and avoid any new upward pressure on prices,” Madbouly said, adding that the government will ensure continued financial support for the electricity sector.
The decision comes as inflation in Egypt shows clear signs of easing. According to data released this week by the Central Agency for Public Mobilization and Statistics (CAPMAS), annual urban inflation dropped to 12.0% in August 2025, its lowest level in over three years compared to 13.9% in July. The Central Bank of Egypt also reported a decline in core inflation, which fell to 10.7% in August from 11.6% the previous month.
Monthly consumer prices saw a rare deflationary movement, with the general consumer price index declining by 0.4%, suggesting that previous inflationary pressures—largely driven by energy costs and food prices—are beginning to ease.
The electricity price freeze follows a sharp increase in August 2024, when tariffs were raised by 14% to 40% for households, 23.5% to 46% for the commercial sector, and 21.2% to 31% for industry. Those hikes came amid a national electricity crisis triggered by fuel shortages, which led to widespread power cuts during the summer months. The situation has since been brought under control, thanks to emergency imports of liquefied natural gas and fuel oil.
Debt Reduction Targeted
In addition to addressing inflation, Madbouly outlined the government’s broader fiscal goals, including a plan to bring public debt under control. He stated that Egypt is targeting a reduction in public debt to 80% of GDP during the current fiscal year (2025–2026), with further declines expected in the years ahead.
“The external debt is now under control, and the most difficult phase has passed,” Madbouly declared. “We are fully aware of our repayment obligations this year, and the figures are already down from last year.”
Managing Egypt’s debt burden has become increasingly urgent, as interest payments currently absorb approximately 79% of the country’s revenues, significantly constraining public spending on other priorities. The government hopes that reduced inflation, fiscal consolidation, and a more stable macroeconomic environment will support ongoing efforts to manage debt sustainability.
Boosting Regional Trade with Tunisia
On the regional front, Egypt and Tunisia have agreed to double bilateral trade over the next two years. Trade volume between the two countries currently stands at around $500 million annually.
Madbouly revealed that the two sides are working through the private sector to achieve this target. He also announced that several memoranda of understanding (MoUs) would be signed on Thursday during a bilateral meeting with his Tunisian counterpart, covering key sectors such as trade, investment, health, youth, and sports.
The announcement came hours after President Abdel Fattah el-Sisi received Tunisian Prime Minister Sarra Zaâfrani in Cairo on the occasion of the 18th session of the Egypt-Tunisia High Joint Committee. The summit highlights the two nations’ efforts to deepen economic and diplomatic cooperation across a broad range of sectors.
As Egypt grapples with post-crisis economic recovery, the government’s focus on inflation control, fiscal discipline, and regional integration reflects a multi-pronged strategy to restore stability, attract investment, and support long-term growth.
