Egypt in need of structural reform, warns IMF

09 April 2014

Latest report forecasts 2.3 per cent GDP growth in 2014

Egypt’s economy will continue to be hampered by a lack of structural reform and poor government finances, warns the Washington-based IMF in its latest report.

The fund says continued political uncertainty will “weigh on tourism and foreign direct investment”, but adds that the billions of dollars of aid flowing in from the GCC has lessened the immediate impact.  

According to the IMF’s regional outlook, released on 8 April, Egypt’s current account balance is expected to worsen by 2015, falling to -4.6 per cent of GDP from -2.1 per cent in 2013.

GDP growth for 2014 is forecast to stay in line with last year, growing at 2.3 per cent, compared to 2.1 per cent in 2013. It is set to rise to 4.1 per cent by 2015.

Unemployment is predicted to stay at a relatively high but steady rate of 13 per cent.

Egypt’s economy has been in decline since the overthrow of former President Hosni Mubarak in 2011 and the subsequent ousting of President Mohamed Mursi last July.

The country has been run by an interim government since mid-2013, but is preparing to vote on a new president in May, with results due no later than 26 June.

General Abdul Fattah al-Sisi officially announced his candidacy for the role at the end of March, and is considered the favourite for the position.

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