Egypt’s GDP growth rate records 3.5% in the first quarter of FY 2024/2025
The Ministry of Planning, Economic Development, and International Cooperation released the GDP growth rate for the first quarter of FY 2024/25 as part of its quarterly updates on the Arab Republic of Egypt’s economic performance. The real GDP growth rate recorded a growth rate of 3.5%, compared to 2.7%, during the same quarter of the previous FY 2023/24, following the improvement in the performance of specific sectors such as the non-petroleum manufacturing sector. This growth is attributed to the reform policies implemented by the government aimed at restoring macroeconomic stability and strengthening the governance of public investments
The non-petroleum manufacturing sector witnessed a positive growth for the second consecutive quarter, following the economic reform policies implemented since March 2024, recording a growth rate of 7.1% in the first quarter of FY 2024/2025 compared to the same period last year. This can be attributed to a series of targeted measures, including streamlined customs clearance processes at ports, increasing the supply of essential production inputs and accelerating industrial production. These efforts are further reflected in the positive outturn observed in the monthly Industrial Production Index (excluding oil refining), which recorded a growth of 6% during the first quarter of FY 2024/2025, compared to a contraction of 7.7% in the same quarter of the previous fiscal year. This is in line with the increase in exports from the chemical and fertilizer industries, pharmaceuticals, perfumes, cosmetics, and ready-made garments also witnessed positive growth
Several key sectors continued to demonstrate positive growth in the first quarter, including communications and information technology (12.2%), tourism (8.2%) (reflected in restaurants and hotels), electricity (7.4%), transportation and storage (15.6%), social services including health and education (4.5%) and agriculture (2.65%). This is in line with the government’s vision of diversifying the economy by enhancing the contributions of the manufacturing, agriculture and ICT sectors to GDP, in addition to sectors related to human and social development
On the other hand, the Suez Canal remains the most affected by geopolitical tensions in the region, recording a contraction of 68.4% during the first quarter of FY 2024/2025. This is due to the decline in the number of vessels passing through the Suez Canal, resulting in reduced revenues
The extraction sector also experienced an 8.9% decline in the first quarter of FY 2024/2025. However, the production of gas and oil is expected to improve in the coming months, supported by the government’s efforts to settle outstanding dues to foreign oil and gas companies
In light of the efforts of the Ministry of Planning, Economic Development and International Cooperation to implement a robust governance of public investments, private investments increased by 30%, reaching 133.1 billion pounds at constant prices, compared to 102.3 billion pounds in the same quarter of the previous year. In contrast, public investments experienced a significant decline of 60.5%, totaling 57 billion pounds, down from 144.4 billion pounds in the corresponding quarter of the previous year
Moreover, high-frequency data signal positive signs of improvement in economic activity, as the PMI showed a modest increase in November 2024, reaching 49.2 points, compared to around 49 points in October. It remained close to the neutral threshold (50 points) for the third consecutive month, driven primarily by expansions in manufacturing activities. Additionally, new foreign export order inflows continued to rise for seven consecutive months, indicating a positive outlook for the recovery of export activity
Although the Business Barometer index declined in Q4 of FY 2023/2024, reflecting lower performance compared to the same quarter of FY 2022/2023, it increased by one point above the neutral threshold during Q1of FY 2024/2025. This improvement is attributed to gains across most indicators, particularly production, sales, exports, and production capacity utilization
These indicators align with forecasts from various international institutions, as well as the Ministry’s projection, suggesting that GDP will grow by 4% in the current fiscal year 2024/2025. This positive outlook is expected due to the government’s ongoing efforts to foster a private sector-led growth, while adopting measures to refine monetary and fiscal policies to better support economic recovery
رابط مختصر:
جاري التحميل ...
