Egypt will raise the minimum wage for public sector workers to 7,000 Egyptian pounds ($138.50) per month from July, bringing it in line with the private sector’s newly set floor, Finance Minister Ahmed Kouchouk announced Wednesday.
The increase is part of a broader social protection package costing between 80 billion and 85 billion Egyptian pounds ($1.6-$1.7 billion), set to take effect at the start of the new fiscal year.
Ahead of that, the government will implement a temporary relief package worth up to 40 billion pounds ($791 million) from March through June, which includes additional support for 10 million low-income families through the state’s ration card system.
Despite the latest hike, the real value of Egypt’s minimum wage has continued to decline due to persistent inflation and currency depreciation.
The minimum wage was last raised in February 2024 by 50% to 6,000 pounds, then worth about $194. The new adjustment leaves workers with less purchasing power in dollar terms.
Inflation has remained elevated since early 2022, when the war in Ukraine triggered capital outflows from Egypt’s debt market.
In January, annual urban inflation stood at 24%, slightly easing from 24.1% in December but still weighing heavily on household budgets.
Egypt is grappling with a deep economic crisis marked by a foreign currency shortage and repeated devaluations.
The government is negotiating an $8 billion loan from the International Monetary Fund as part of efforts to stabilize the economy. The IMF deal requires Egypt to adopt a more flexible exchange rate, scale back the state’s role in the economy, and boost private sector participation.
With the Egyptian pound trading at a record low of about 50.54 per dollar, further depreciation could erode the wage increase’s impact, leaving workers struggling with rising costs despite the nominal boost.
