IMF Egypt Review: GDP growth revised to 4.5% in FY 2016/17

CAIRO – 26 September 2017: Egypt’s real GDP growth for fiscal year 2017/18 is expected by International Monetary Fund to record 4.5 percent, compared to their original prediction of 4.8 percent, the IMF said in their staff report of their first review, on Tuesday.

As for FY 2016/17, the real GDP is said to have stood at 3.5 percent, down from their original prediction of 4 percent, the IMF noted.

The macroeconomic indicators of the IMF stated that consumer prices are seen to mark an average of 22.1 percent in FY 2017/18, up from a previous forecast of 13.3 percent. In the previous fiscal year, the prices recorded an average of 23.9 percent increase, up from 18.2 percent in their original expectations.

The gross debt for the current fiscal year is expected to reach 87.7 percent of GDP, down from previous forecast of 89.1 percent, while for FY 2016/17, the gross debt came at 98.4 percent of GDP, compared to 93.8 percent of GDP.

Going up by more than double, the external debt came at 20.8 percent of GDP, compared to an initial forecast of 10.1 percent of GDP over FY 2016/17. The current fiscal year is not seeing any better in that regard because IMF’s revised forecasts put the external debt at 19.1 percent of GDP, compared to 8.9 percent in their expectations.

Recording improvements, the domestic debt is predicted to register 68.6 percent of GDP in FY 2017/18, compared to 80.2 percent in estimations. In FY 2016/17, it went down to 77.7 percent of GDP, compared to an initial view of 83.7 percent.

Budget revenues and grants would comprise 18.8 percent of GDP in the current fiscal year, compared to 18.2 percent in FY 2016/17, which came lower than estimates of 20.7 percent of GDP.
With regard to expenditures this fiscal year, it is expected to stand at 27.3 percent of GDP, slightly higher than expected rate of 27.2 percent, which is also more than 28.7 percent of GDP estimated by the IMF for FY 2016/17.

Energy subsidies contribution in the GDP of FY 2017/18 was revised by the IMF to be 3.1 percent, compared to their prediction of 1.4 percent. In the previous fiscal year, the contribution came at 3.9 percent, up from 2.9 percent as per the IMF figures.

On the monetary sector level, reserves money is seen to shape 24.5 percent of the GDP in the current fiscal year, compared to 18.9 percent in the initial prediction. In FY 2016/17, the reserves estimates came at 26.8 percent, compared to 16.1 percent.

Treasury bills’ contribution in the current fiscal year recorded 21.3 percent of the GDP in the IMF’s revised forecasts, compared to 14.9 percent, while in the previous fiscal year, it came at 18.1 percent.