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Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

After having recovered from the internal political crisis and revolutionary uprising of 2011, the Egyptian economy recently slowed down due to the outbreak of the COVID-19. According to IMF estimates, GDP growth continued to decrease to 3.3% in 2021 from 3.6% in 2020. Despite this slowdown, Egypt remained one of the few countries with positive growth rate in 2021. According to the IMF's forecast, GDP growth is projected to recover to 5.2% in 2022 and 5.6% in 2023, subject to the loosening of health measures and a post-pandemic global economic recovery.

In 2021, Egypt's economy continued to be impacted by the COVID-19 pandemic, as recovery was delayed by renewed surge in infections and the emergence of new Covid-19 variants. Proactive measures taken to address health and social needs and support the most directly affected sectors, as well as the IMF-supported economic reform program, helped mitigate the economic and human impact of the crisis (IMF). In addition, before the pandemic, the country was already in a strong position as it had implemented an economic reform program comprising fiscal consolidation measures, the introduction of a floating exchange rate and large cuts in subsidies. In 2021, the budget deficit increased slightly to -7.6% GDP (from -7% GDP in 2020), and is expected to decrease to -6.5% GDP in 2022 and -5.6% GDP in 2023 thanks to economic recovery (IMF). Public debt-to-GDP ratio increased to 91.4% in 2021 (from 89.8% in 2020) and is expected to decline to 89.5% in 2022 and 86.2% in 2023 (IMF). The public debt’s non-resident and foreign currency portions are expected to increase with international financing (Coface). Appropriate monetary policy allowed the inflation rate to further decrease and to stay well below the central bank’s target range, reaching 4.5% in 2021. It should stay under control but increase to 6.3% in 2022 and 7.1% in 2023, according to IMF estimates. For 2022, the priority remains to support the economic recovery while continuing to preserve macroeconomic stability. The authorities are committed to pursue the structural reform program that aims at more inclusive and sustainable private sector-led growth,  durable jobs creation and improved external resilience (IMF). The country’s post-Covid-19 recovery will be guided by the Egypt Vision 2030 strategy, which comprises numerous programs related to transport, entrepreneurship, logistics, environment etc. (Oxford Business Group). Major risks include a persistent COVID-19 pandemic, less favourable financing conditions for emerging markets, and a drop in remittances (IMF).

The official unemployment rate, after reaching its highest level in the past 11 years in 2015 (13.4%), has been declining slowly since then. However, due to the COVID-19 pandemic, it increased to 9.3% in 2021 and should remain at that level in 2022 (9.2%) according to IMF estimates. It is estimated that three-quarters of all employees are paid as unofficial workers, and 32.5% of the population lives below the poverty line (state statistics agency CAPMAS). Female youth unemployment remains very high (53% in 2019 according to the World Bank).

 
Main Indicators 201920202021 (e)2022 (e)2023 (e)
GDP (billions USD) 302.34363.25e396.33438.35476.36
GDP (Constant Prices, Annual % Change) 5.63.6e3.35.65.6
GDP per Capita (USD) 3,0573,6013,8524,1774,450
General Government Balance (in % of GDP) -7.7-7.0-7.6-6.5-5.6
General Government Gross Debt (in % of GDP) 84.289.8e91.489.586.2
Inflation Rate (%) 13.95.74.57.511.0
Unemployment Rate (% of the Labour Force) 8.68.39.39.28.8
Current Account (billions USD) -10.89-11.17-15.39-16.05-12.91
Current Account (in % of GDP) -3.6-3.1-3.9-3.7-2.7

Source: IMF – World Economic Outlook Database, October 2021

Note: (e) Estimated Data

Main Sectors of Industry

Agriculture contributes 11.6% of the GDP (World Bank, 2020) and employs 21% of the active population (World Bank, 2019). The sector has historically been important for Egypt, and it accounts for about 20% of total exports and foreign exchange earnings. It appears as the most resilient sector in the context of the COVID-19 pandemic. The warm climate and the abundant Nile water allow for several annual harvests. The main crops are cereals, cotton, sugar cane and beetroots.

Egypt's non-oil industry remains rather limited. With automotive manufacturing, steel manufacturing, cotton cultivation, textile production and the construction industry, the secondary sector accounts for 32% of the GDP (World Bank, 2020) and employs 27% of the workforce (World Bank, 2019). The mining industry accounts for only 0.5% of the GDP, but is a strategic sector at the centre of the country’s development plan (Oxford Business Group). In spite of economic diversification efforts, the country continues to depend on the Suez Canal for a large part of its foreign income. In 2021, the Suez Canal Authority generated USD 6.3 billion revenues, the highest annual revenue in its history (Egypt Oil&Gas). Despite the COVID-19 pandemic, Egypt also announced record oil production levels in 2020, exceeding 650,000 barrels per day, stable LNG production and LNG exports at full capacity in December 2021 (Reuters).

Finally, the services sector represents 51.8% of the Egyptian GDP (World Bank, 2020) and employs more than half of the population (52% in 2019). It is largely dominated by revenues from telecommunications and tourism sectors. Due to the COVID-19 pandemic, the services surplus declined sharply from USD 13.0 billion in 2019 to USD 8.9 billion in 2020 and USD 5.1 billion in 2021, mainly as a result of the decrease in tourism revenues. Travel receipts fell from USD 12.57 billion in 2019 to USD 4.86 billion in 2021 (Central Bank of Egypt).

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 20.6 26.9 52.4
Value Added (in % of GDP) 11.5 31.8 51.7
Value Added (Annual % Change) 3.3 0.6 3.6

Source: World Bank, Latest Available Data. Because of rounding, the sum of the percentages may be smaller/greater than 100%.

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.}}

Score:
55,7/100
World Rank:
130
Regional Rank:
11

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 

Business environment ranking

Definition:

The business rankings model measures the quality or attractiveness of the business environment in the 82 countries covered by The Economist Intelligence Unit’s Country Forecast reports. It examines ten separate criteria or categories, covering the political environment, the macroeconomic environment, market opportunities, policy towards free enterprise and competition, policy towards foreign investment, foreign trade and exchange controls, taxes, financing, the labour market and infrastructure.

Score:
5.47/10
World Rank:
62/82

Source: The Economist Intelligence Unit - Business Environment Rankings 2020-2024

 

Country Risk

See the country risk analysis provided by Coface.
 

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Actualitzacions: September 2022

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