Egypt’s economy may be revived as forecasts predict a 5.3% growth by June 2019

Cairo is going ahead with economic reforms imposed under a 2016 IMF-backed austerity plan.
A picture taken on July 29, 2018 shows a tailors sewing at the Marie Louis textile clothing and textile factory in the 10th of Ramadan city, about 60 kms north of Cairo. (Photo by Khaled DESOUKI / AFP)

 Although, Egypt had targeted growth at 5.8 percent in its 2018/2019 fiscal year budget, forecasts are showing that the economy is expected to grow at 5.3 percent in the fiscal year ending in June. .

 According to forecasts by economists polled by Reuters, the economy, with the exception of the oil sector, has struggled to attract foreign investors since the 2011 uprising 

Hoping to bolster investor confidence, Egypt has been implementing tough economic reforms as part of a three-year, $12bn deal agreed with the International Monetary Fund in November 2016. 

The reforms include a value-added tax, cuts to energy subsidies and a steep currency devaluation.

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The median forecast from 14 economists polled put growth at 5.3 percent in the current 2018/2019 fiscal year and 5.5 percent the following two fiscal years.

According to Nadene Johnson, an economist at NKC African Economics, Medium-term growth remains slightly subdued as the government maintains a strong grip on the economy, but is nonetheless supported by an expected expansion in the infrastructure, manufacturing and tourism sectors

Recent data from UNCTAD’S Global Investment Trends monitor however showed Egypt was the biggest recipient of FDI in Africa in 2018 with investments in real estate, food processing, oil and gas and renewable energy.

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