Egypt to hit 2% growth rate if coronavirus continued till end of 2020

CAIRO – 3 May 2020: Egypt’s economic growth rate would decrease to 2 percent during the next fiscal year 2020/2021 if the coronavirus crisis continued until December 2020, Minister of Planning Hala el-Saeed said Sunday.

She added in a statement that there are two scenarios to recover from the coronavirus crisis, which are containing the virus by the end of June 2020 or the end of December 2020, and each of them would affect different sectors with various degrees.

She added that it is expected to achieve a growth rate of 3.5 percent during the next fiscal year if the outbreak of the coronavirus ends at the end of the current fiscal year on June 30, and that its effects are expected to extend to the first quarter of the next fiscal year or the entire first half.

"But if the crisis persists until December 2020, the targeted growth rate will decrease to 2 percent," she noted.

She explained that it was intended to achieve a rate of growth of 5.8 percent in 2020, but it is expected to reach 4.2 percent with the slowdown in the growth of the third and fourth quarters to 4.5 and 1 percent, respectively.

This came during the Minister of Planning's discussion of the basic features of the sustainable development plan for 2020/2021 before the Parliament's Plan and Budget Committee, during the discussion of the state's draft general budget.

She pointed out that in the case of recovery, not all sectors will recover in a similar way, some will recover quickly, others will require longer time to recover, but there are some sectors that have a great deal of flexibility and ability to bear the crisis and quick recovery.

She noted that there are sectors that have opportunities to maximize the benefits of the corona's consequences, such as "agriculture, communications, information technology, the pharmaceutical and chemical products industry, and construction and building".

The Minister stressed that most of the global institutions unanimously agreed that the current crisis is the most severe economic crisis, as it affected both the supply and demand sides with the impact of global value chains, the suspension of manufacturing activity in many countries, the decline in the level of wages, as well as the high rates of unemployment, and consumer confidence has plummeted.