Egypt

Egypt Economic Outlook

Real GDP growth was an estimated 5.3% in 2018, the highest rate in a decade. The growth was associated with a decrease in unemployment to around 10% from 12% in 2017. On the supply side, recoveries in tourism and in natural gas production sustained growth. On the demand side, net exports and investment rebounded, while private household consumption weakened due to inflation. With the ongoing broad fiscal consolidation effort, the fiscal deficit declined to 9.0% in 2018, and the fiscal balance excluding interest payments (primary balance) reached a modest surplus. The debt-to-GDP ratio decreased to 92.5% in 2018 from 103% in 2017. Following the 2016 devaluation, the nominal and real effective exchange rates dropped substantially, benefiting exports due to increasing price competitiveness and improving terms of trade.

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