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publication April 1, 2019

Egypt's Economic Update - April 2019

Latest Issue: 
  • April 2019

Egypt’s economic growth has been robust, averaging 5.3 percent in FY2017/18; a rate that was sustained through Q1-FY2018/19, driven by an expansion in the gas extractives, tourism, manufacturing, construction and ICT sectors. Private investment is picking up and net exports are improving.

There is however evidence that non-oil private activities continue to be hampered by the cumbersome business environment, including non-tariff measures and poor institutional capacity at the borders that constrain trade. Consequently, job creation remains modest.

Economic growth is expected to reach 6 percent in the medium term, as key economic sectors continue to recover. Fiscal consolidation will be helped by an expected increase in tax revenues with accelerating growth and the envisaged tax administration reforms, and as energy subsidy reforms continue. Yet, debt servicing is expected to remain a burden on the budget, therefore hindering larger social spending, notably on health and education.

The current account deficit is projected to stabilize over the medium term, but the capital and financial account may start declining, as the large financing related to the IMF program comes to an end by June 2019 and as declining yields on government debt instruments make Egypt less attractive to emerging market investors.

Egypt's Economic Update - April 2019 (PDF Format)