In-Depth Analysis
Egypt
Macroeconomic indicators have improved significantly over the past two years thanks to a bold reform programme. However, structural challenges related to a high level of state presence in the economy are keeping medium-term growth subdued, while the fiscal position remains heavily burdened by high domestic public debt levels.
Economic growth picked up slightly in Q4 2018/19 FY averaging 5.7% y-o-y, compared to 5.6% y-o-y in the previous quarter. Whilst the uptick can be partly attributed to a slow recovery in household consumption, the main driver of economic growth was investment growth, which gained momentum thanks to rising capital expenditure, likely associated with infrastructure investment. Furthermore, although real imports were suppressed by slow recovering consumption levels and ongoing import restrictions, this was offset by declining real exports. Real exports have taken a knock owing largely to the strong appreciation of the Egyptian pound in recent months. Looking ahead, continued overvaluation of the currency over the short-term is expected to weaken the competitiveness of nonfuel exports and therefore weigh on GDP growth, which is forecast to slow marginally to 5.5% in FY 2019/20. On a more positive note, however, easing inflationary pressures coupled with accommodative monetary policy should help support the recovery of consumption levels going forward. (Source: Egypt Quarterly Update, published November 2019.)
Macroeconomic Data
(2018)
|
Fiscal Balance (as a % of GDP) |
-9.5 |
|
Consumer Price Index (% change y-o-y, avg) |
14.4 |
|
Current Account Balance (as a % of GDP) |
-2.3 |
|
Real GDP (annual % change) |
5.3 |
|
GDP per Capita, US$ |
2,811.7 |
|
Import Cover (months) |
6.1 |
|
Population, million |
98.4 |
| Total External Debt (as a % of GDP) |
35.7 |