CAIRO - 10 October 2023: The International Monetary Fund (IMF) has revised its growth expectations for the Egyptian economy for the fiscal year 2022/2023, projecting a growth rate of 4.2 percent compared to the previous estimate of 3.7 percent in the July report. However, it has lowered its expectations for the current fiscal year 2023/2024 to 3.6 percent, down from the earlier projection of 4.1 percent in July.
According to the World Economic Outlook report released during the annual meetings of the World Bank and the International Monetary Fund in Marrakesh, Morocco, the IMF anticipates that consumer prices in Egypt will increase from 13.2 percent in the fiscal year ending in 2022 to 35.7 percent 2022/2023, followed by a decrease to 25.9 percent in 2023/2024.
The report also suggests that unemployment rates in Egypt may drop to 7.1 percent from 7.3 percent in 2021/2022 but are expected to rise again in 2023/2024 to 7.5 percent.
In December, the International Monetary Fund (IMF) approved a 46-month program for Egypt with a value of $3 billion. The program is set to undergo two reviews each year until mid-September 2026, totaling eight reviews.
The first review, which determines the disbursement of the second tranche of the loan, was originally scheduled for mid-March but has been delayed, as the government has not implemented the offerings program and has not achieved the necessary flexibility in the exchange rate of the Egyptian pound.
The first payment of $347 million was received by Egypt from the IMF in December, and the remaining payments were scheduled to be received in March and September of each year from 2023 to 2026. The due payments have not yet been received.
On a global scale, the report indicates a deceleration in economic growth, with a decline from 3.5 percent in 2022 to 3 percent in 2023 and further to 2.9 percent in 2024. This represents a 0.1 percentage point reduction for 2024 compared to the previous outlook report issued in July.
Advanced economies are expected to slow from 2.6 percent in 2022 to 1.5 percent in 2023 and 1.4 percent in 2024 as policy tightening starts to bite, according to the report.
It revealed that emerging market and developing economies are projected to have a modest decline in growth from 4.1 percent in 2022 to 4.0 percent in both 2023 and 2024.
Global inflation is forecast to decline steadily, from 8.7 percent in 2022 to 6.9 percent in 2023 and 5.8 percent in 2024, due to tighter monetary policy aided by lower international commodity prices. Core inflation is generally projected to decline more gradually, and inflation is not expected to return to target until 2025 in most cases.