IMF raises its forecast for Egypt's economy growth to 2.8% in 2020/21

CAIRO – 10 January 2021: International Monetary Fund (IMF) raised its forecast for the Egyptian economy for 2020/2021 to 2.8 percent, from 2 percent in its forecast in June 2020.

In the report of the first review of the Credit Standards Arrangement Program for Egypt, the IMF expected the growth of the Egyptian economy by about 5.5 percent during the fiscal years 2021/2022 and 2022/2023.

According to the report, the growth of the Egyptian economy in 2024/25 is expected to reach 5.8 percent, after recording 5.6 percent in 2023/24.

The report pointed out that the abolition of closure measures and partial curfew in Egypt helped to show the Egyptian economy "early signs of recovery" after a more moderate slowdown than expected.

Egypt was one of the few countries that recorded growth during 2020, and the report estimated the growth of the Egyptian economy in 2020 by 1.5 percent.

On the other hand, this will mean that the 2022/2021 fiscal year will witness less dramatic growth, as the recovery is expected to start sooner than expected.

For his part, Minister of Finance,Mohamed Maait, indicated that the results of the consultations conducted by the IMF mission on the performance of the Egyptian economy, through video technology, during the period from 4 to 18 November 2020, confirmed the recovery of the Egyptian economy from the effects of the "pandemic", exceeding fund experts’ previous expectations, which opens the door for Egypt to obtain additional financing of $ 1.6 billion, as soon as the IMF Board of Governors approves the results of the review, which will be presented to the Board within weeks.

In May, Egypt received $ 2.77 billion from the International Monetary Fund, which represents the value of the rapid credit financing granted to the Egyptian government.

In June, the Executive Board of the International Monetary Fund finally approved the disbursement of a loan to Egypt worth $5.2 billion (equivalent to 3.76 billion special drawing units) for a year, within the framework of the "credit preparedness agreement" tool, to meet the financing needs of the balance of payments resulting from the "Covid-19 epidemic".