World Bank forecasts Egypt’s GDP at 4.2% in FY2025/26
Updated 1/19/2025 8:43:00 AM
Arab Finance: The World Bank expects Egypt’s real gross domestic product (GDP) growth for fiscal year (FY) 2024/2025 to hit 3.5% and 4.2% in FY2025/26, according to the financial institution’s Global Economic Prospects report for January.
This projected GDP growth is driven by “private consumption growth amid gradually abating inflation, robust inflows of remittances, and improved sentiment.”
In 2025, the state’s interest payments are likely to remain elevated, the report showed.
In FY2023/24, economic growth slowed to 2.4% due to a decline in shipping through the Suez Canal and lower natural gas production.
The drop was also affected by “the contraction of the non-oil manufacturing sector due to higher input costs, lingering supply bottlenecks, and earlier foreign exchange shortages”.
However, the liberalization of the exchange rate, which took place in March 2024, boosted investor confidence, reinforcing private sector activity in the second half (H2) of 2024.
It is worth noting that the International Monetary Fund (IMF) downgraded its forecast for Egypt's real GDP growth by 0.5% and 1% for FY2024/25 and FY2025/26, respectively.
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