CAIRO - 2 January 2025: The Information and Decision Support Center (IDSC) affiliated with the Egyptian Cabinet issued Thursday a new report that addressed "International Institutions' Expectations for the Performance of the Egyptian Economy in 2025."
The report explained that the world witnessed economic challenges in 2024, the effects of which extended to various countries, and constituted a continuation of a turbulent economic period at the international level. The report went on explaining that this is as a result of global and regional geopolitical tensions, and the continued tightening of monetary policies in a number of central banks to combat inflation, with the continuation of some challenges facing supply chains that have not yet fully recovered from the effects of the Covid-19 pandemic, followed by the Russian-Ukrainian crisis, and tensions in the Middle East region.
Expectations for Egyptian economy
As a new year begins, expectations for the performance of the Egyptian economy vary, reflecting hopes and ambitions, as well as the continuation of the existing repercussions of global economic and geopolitical challenges, amid an atmosphere in which the Egyptian state's efforts continue on a number of levels to achieve economic stability and push the pace of comprehensive and sustainable growth.
Many international institutions expect positive growth for the Egyptian economy in 2025 as a result of the economic reforms implemented by the government. These reforms are expected to lead to increased investments and higher private consumption rates as a result of the decline in inflation and the increase in remittances from workers abroad.
Based on these factors, the growth rates of the Egyptian economy are expected to rise in 2025 to range between 3.5 percent and 4.5 percent, as the International Monetary Fund expects the Egyptian economy to witness a growth of 4 percent in 2025 compared to an expected growth of 2.7 percent in 2024.
It is also expected that the GDP at constant prices will rise to 8.7 trillion pounds in 2025 compared to 8.4 trillion pounds in 2024. The GDP at current prices is also expected to rise to 17.5 trillion pounds in 2025 compared to about 13.8 trillion pounds in 2024. T
These expectations come to reflect an expected recovery in the performance of the Egyptian economy with the development of the Ras El-Hikma area and the fading of geopolitical pressures in the second half of the fiscal year 2024/2025, and in the medium term, the International Monetary Fund expects the growth rate of the Egyptian economy to increase during the period (2025-2029) to record about 5 percent, reflecting the positive impact of implementing a number of structural reforms aimed at enhancing the business climate.
According to the World Bank's expectations, the growth of the Egyptian economy is expected to begin a gradual recovery, as the GDP growth rate is expected to reach 3.5 percent and 4.2 percent in 2025 and 2026, respectively, compared to 2.5 percent in 2024, driven by several key factors; including increased investments, especially those financed by the Ras El-Hikma agreement, in addition to the improvement in private consumption, which the bank expects to grow by 4.8 percent in 2025 compared to 4.6 percent in 2024.
Global economy amid global challenges
The report referred at the beginning to the expectations of international institutions regarding the growth of the global economy during 2025, indicating that it is a cautious global growth in the face of global challenges, as the International Monetary Fund's expectations in October 2024 included the stability of the global growth rate at rates below what was hoped for, estimated at about 3.2 percent in 2025, which is the same expected rates for the growth of the global economy in 2024.
The Fund also expected the growth rate of the global economy to reach 3.1 percent after five years from now, which is a modest performance compared to the average growth rate recorded before the Covid-19 pandemic.
The report further added that at the level of country groups, the Fund expected a slight improvement in the growth rates of advanced economies to record 1.8 percent during 2024 and 2025, compared to about 1.7 percent in 2023.
In contrast, the International Monetary Fund slightly reduced its expectations for the growth of the economies of developing countries and emerging economies to reach 4.2 percent during 2024 and 2025, compared to 4.4 percent in 2023, indicating that disruptions in the production and shipment of basic commodities - especially oil - and conflicts, unrest and severe weather events led to a decline in future expectations for countries in the Middle East, Central Asia and Sub-Saharan Africa.
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