EconomyTop Stories

Egypt’s GDP to expand by 4% in FY2023/24: World Bank

The analysis estimates that between USD 2.64 billion and USD 4.55 billion will be required to finance Egypt's hungry in 2024

According to the World Bank Group’s most recent research on the MENA (Middle East and North Africa) area, Egypt’s gross domestic product (GDP) is predicted to increase by 4% in fiscal years (FY) 2023/2024 and 2024/2025.

The researchers noted that the estimate for Egypt confirms the belief that the recent fall of the Egyptian pound may increase its competitiveness, apart from the fact that the country’s capital and financial accounts would remain under continuous pressure.

According to the international financial institution’s research, growth is anticipated to continue in the construction and services sectors, mainly tourism and Suez Canal activity.

According to the analysis, the country will require between USD 2.77 billion and USD 4.15 billion in development funds for food security in 2023 and between USD 2.77 billion and USD 5.25 billion in 2027.

Given that they only account for the very minimum amount of calories needed and do not consider the variety required for a nutritious diet, these numbers emphasise the scope of the task.

The analysis estimates that between USD 2.64 billion and USD 4.55 billion will be required to finance Egypt’s hunger in 2024.

According to the World Bank’s forecast in its Global Economic Prospects report from January 2023, Egypt’s real GDP is expected to drop to 4.5% in FY 2022/2023.

On the other hand, the World Bank also projected that the inflation rate would drop to 18.9% by the end of FY2022/2023, down from the current 30.9%.

The inflation rate in FY2023/2024 would drop to 15% by the end of FY2023/2024, the report added.

The apex financial body also projected that Egypt’s current account balance would drop to 3.4% in 2023 and 3% in 2024, down from 3.5% recorded in 2022.

The World Bank study also expects that the budget deficit would widen to 7% of GDP at the end of the current FY2022/2023, up from 6.2% in FY2021/2022.

Fiscal pressures and the valuation effect from the Egyptian pound devaluation are projected to drive the country’s debt-to-GDP ratio to the projected 95.5% by the end of the current 2022-2023 financial year, up from 88.3% a year earlier.

“The USD 1.5 billion Sukuk [that were recently issued] provided some relief for external debt repayment during current FY2022/2023,” the report noted.

However, the World Bank cautioned that the burden of the high-interest rate of these Sukuk “may discourage further issuances before international financial conditions improve.”

Related posts

British economy grew despite gloomy forecasts

GBO Correspondent

Access Bank to merge its Zambian unit with African Banking Corporation

GBO Correspondent

Sri Lanka economic crisis: Rise and fall of Rajapaksa family

GBO Correspondent