Egypt's economic recovery gains momentum as growth expected to reach 4.8% in 2023-2024 fiscal year

CAIRO – 28 September 2023: According to the European Bank for Reconstruction and Development (EBRD), Egypt experienced a deceleration in its economic growth, which reached 4.1 percent in the fiscal year ending in June 2023 (2022-2023). However, there is optimism on the horizon, as growth is anticipated to bounce back to 4.8 percent in the fiscal year 2023-2024.

In its recent report, the EBRD pointed out that despite the recovery of revenues from the Suez Canal and the tourism sector, the growth momentum has been hindered by a slowdown in construction and manufacturing activities, along with a reduction in gas production.

Estimates indicate that natural gas production declined by 9.3 percent year-on-year in the first half of 2023, reaching its lowest level in three years.

Simultaneously, unemployment edged slightly down to 7.0 percent in the second quarter of 2023, with higher rates among women (19.2 percent) and in urban areas (10.3 percent).

In addition to rising global commodity prices, this decrease in production has pushed inflation to a record level, reaching 36.5 percent in July 2023, despite the Central Bank's cumulative 1100 basis point interest rate hikes since April 2022.

Foreign exchange reserves in the country have remained stable, partly attributed to the International Monetary Fund-supported program, which has improved access to external financing.

Earlier, Dr. Hala El Said, the Minister of Planning, projected in previous statements that the Gross Domestic Product (GDP) for the current fiscal year 2023/2024 would reach approximately LE 11.4 trillion at current prices, compared to the expected value of LE 9.8 trillion for the previous fiscal year 2023/2022, registering a growth rate of 4.1 percent at constant prices.

Egypt has been navigating economic challenges and opportunities in recent years. The country's strategic location, along with its efforts to attract investments and diversify its economy, has positioned it as a promising player in the region. The ongoing recovery of key sectors, coupled with ambitious growth targets, underscores Egypt's resilience and determination to advance its economic development.