Cairo - Mubasher: The European Bank for Reconstruction and Development (EBRD) has upgraded its economic growth forecast for Egypt during fiscal year 2017/2018 to 5.3%.
This is a 0.8% increase compared to the previous expectations of 4.5%.
The decision was attributed to an improved competitiveness and greater investor confidence.
“In Egypt, growth continued to accelerate for the fifth consecutive quarter and reached 5.3% year-on-year in the second quarter of the FY17/18. The acceleration was driven by manufacturing, trade, tourism and construction, as well as the recovery in mining.”
“Exports and investment picked up and became more prominent drivers of growth thanks to the liberalisation of the exchange rate in November 2016, the resolution of foreign exchange shortages and the strong performance under the IMF-supported programme.
“Meanwhile, private consumption slowed down and its contribution to growth declined, the result of the record levels of inflation which reached its peak in July 2017 and averaged 29.6% in 2017, thus eroding purchasing power.
“Economic activity is expected to grow at 5.3% and 5.5% in FY17/18 and FY18/19, supported by 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 indicated.
