Egypt Economy Report – April 2009
It would be naïve to assume Egypt will be unaffected in the current global financial crisis. It is – like all other emerging economies.
Egyptian stock markets also have collapsed. The rapid growth of 7%+ p.a in output measured by GDP seen over the last few years is stalled for now. These heady growth rates and a favorable investment climate was a result of Egypt’s successful five-year economic and structural reforms program initiated by the government since 2004.
Despite this slowdown, we think Egypt’s economy has done reasonably well and nicely poised to resume growth once the global crisis fades. Egypt’s real GDP growth of 4% is still respectable in the back drop of a recession in several other countries.
So far, Egypt has proved to be one of the resilient economies in the emerging markets despite the slowdown. Having said this, Egypt has room for further improvement. Growth in output is likely to further slowdown unless the external environment vastly improves. Continuance of the economic reforms will be the key to restore the growth momentum.