IMF projects Egypt’s growth forecast to be 3.7% in 2023

CAIRO - 26 July 2023: The International Monetary Fund (IMF) projected Egypt’s growth to record 3.7 percent this year and then go up to 4.1 percent in 2024. The IMF kept its 2023 growth forecast for Egypt unchanged in its latest World Economic Outlook (WEO) report.

In a press conference, the fund stated that the lower growth in 2024 is mostly because of the lack of effects flexibility and the shortages that have developed in the effects market in Egypt, which is making it difficult for imports to happen.

The IMF also projected that inflation in Egypt would record 24.4 percent this year and would increase to 32 percent in 2024. During the presser, Petya Koeva Brooks, deputy director in the Research Department of the IMF, said that this is due to “the depreciation of the currency and all of this is underpinning our advice to have policies which restore the macroeconomic balances and also get inflation under control.”

In the WEO report, the IMF also projected that growth in the Middle East and Central Asia would decline from 5.4 percent in 2022 to 2.5 percent in 2023 due to a growth slowdown in Saudi Arabia, from 8.7 percent in 2022 to 1.9 percent in 2023.

Egypt had reached an agreement with the IMF allowing the country to obtain an extended credit facility worth $3 billion that was approved in December 2022.

The agreement program, which extends for 4 years, allows Egypt to obtain additional financing of $1 billion through the newly established “Resilience and Sustainability Fund” by the International Monetary Fund, and an additional external financing package amounting to about $5 billion from several international and regional financing institutions with soft terms.

Earlier in July, the IMF acknowledged the Egyptian Government's recent strides in progressing its Initial Public Offering (IPO) Program, and praised Egypt’s support for these measures aimed at supporting the private sector and easing the dollar shortage.

Recently, the Egyptian Government revealed that it has accomplished 25 percent of the fourth phase of the IPO Program, and has signed contracts with the private sector to sell state-owned entities worth $1.9 billion, with more deals worth $1 billion to be announced soon.