The European Bank for Reconstruction and Development (EBRD) has downgraded its forecast for Egypt’s gross domestic product (GDP) growth to 4.0% for fiscal year 2022/2023, 0.7% down from its previous forecast in February, according to the recently the bank’s May 2023 Regional Economic Prospects report. The international financial institution also trimmed Egypt’s real GDP growth for the upcoming fiscal year 2023/2024 to 4.8%, 0.2% down from its February projection. The downward revision for the North African state is driven by higher fiscal and external vulnerabilities in the country, along with elevated commodity prices and soaring inflation. The report also referred to the possible factors that could hinder growth, which involve further inflationary pressures, tighter monetary conditions, challenges in securing external financing, and slowdowns in implementing structural reforms. Furthermore, EBRD anticipates the cost of servicing public debt in Egypt to surpass 60% of government revenues in 2023 and 70% in 2024.

Source: The North Africa Journal May 17, 2023 11:35 UTC