EBRD sees Egypt economy improving on Zohr, rising FDI, strengthening exports, improved competitiveness
EBRD sees Egypt economy improving on Zohr, rising FDI, strengthening exports, improved competitiveness: The European Bank for Reconstruction and Development (EBRD) is projecting that Egypt’s GDP growth will reach 5.5% in FY2018-19, up from 5.3% in FY2017-18, according to the November 2018 update to its Regional Economic Prospects Report (pdf). Growth is expected to be driven by a number of factors. “These include the continued boost in confidence, recovery in tourism, increase in foreign direct investment, improved competitiveness, continued strengthening of exports, the start of natural gas production from the Zohr field, the implementation of business environment reforms and prudent macroeconomic policies,” the report says. The EBRD notes that net exports and investment were the main drivers of growth since the economic reforms began in FY2016-17, benefitting from gains in competitiveness and confidence. It also notes the recent early signs of recovery in the non-oil private sector, as indicated by a rise in the PMI.
Egypt appears to be among the strongest performers in the southern and eastern Mediterranean region, helping drive up GDP growth there to 4.4% in 2018, up from 3.8% in 2017.
Best year for tourism regionally since 2010: Currency devaluations in Egypt and Tunisia saw the region post its best year in tourism since 2010, according to the report.
Regional losers: The EBRD’s forecasts for growth in Jordan and Lebanon have been revised down from earlier predictions in May after the roll out of reforms in those two countries were held up because of social unrest and political instability. “In both Jordan and Lebanon, the projected growth in 2018 remains below the growth rate of the population, implying a decline in real per capita incomes,” the report said. Morocco’s GDP growth is expected to slow in FY2018 to 3%.