Egypt’s perceived transparency in government policymaking has “notably” declined over the past year, the EBRD said in its annual Transition Report. Egypt’s governance transition score declined to 4.7 from 4.8 in the 2017-18 report.

But, but, but:  The Egyptian economy has also become more competitive, greener, more inclusive, more resilient and more integrated in the past year. We got marked down on the governance score because a risk here of inadequate compliance with AML and CFT frameworks designed to clamp down on money laundering and terrorist financing. Morocco, Tunisia, Serbia, Hungary also got lower scores on this front.

Egypt fared well in terms of financial and energy resilience, the report says. “Banks have weathered the aftermath of the currency depreciation seen at the end of 2016,” and Egypt’s foreign currency shortage has “largely been resolved.” An improved legal framework for the energy sector, particularly when it comes to deregulating the gas industry, has also contributed to Egypt’s score improvement. The report also gave a hat tip to Egypt’s efforts to lift electricity subsidies, “which are being pushed through against an inflationary backdrop, although there remains uncertainty as to when cost reflectivity and market pricing will be achieved.”

Egypt needs to create around 750k new jobs each year to absorb all new entrants to the labor market, but Egypt is among several countries with a mismatch between the skills of recent graduates and the demands of the job market.

Our macroeconomic performance has improved as growth continued to accelerate for the fifth consecutive quarter, real interest rates turned positive in January for the first time in two years as inflation decelerated, and fiscal and external positions have improved, the bank says in its country profile. These improvements come on the back of “major” structural reforms and the enactment of key pieces of legislation, including the bankruptcy, natural gas, railway, and companies acts.

Moving forward with the state privatization program is among the “key priorities” for Egypt in 2019, the EBRD says. “There is a need to prioritise the sale of well-performing, bankable and profitable companies, to rebuild confidence and attract international investors, even from unconventional destinations.” The bank also stresses the importance of remaining committed to the economic reform program — coupled with the enactment of further legislation “needed to strengthen the [macroeconomic and business climate] recovery, including land registration reform” — and keeping our debt levels in check.

You can read the full report here (pdf) or check out the country profile on Egypt here (pdf).