EGP declines vs. USD at Thursday's close    Euro area inflation rises to 2.0% in October '24 – flash estimates    IF YOU LOVE SOMEONE WHO SMOKES, GIVE THEM THE FACTS    Asian stocks slide as chip sector weakens    Egypt's Minister of Environment highlights biodiversity issues at COP16    Egypt's Agriculture Minister meets Syrian, Bahraini counterparts to boost cooperation in Amman    Al-Qassam Brigades targets Israeli vehicles in eastern Gaza    ACUD, DP World, and GAFI sign MoU to develop free zone in New Capital    Egyptian government encourages increased mutual investment with Bahrain: Finance Minister    A Tale of Two Cities: Alexandria hosts 2nd edition of exhibition celebrating Greek, Egyptian cultural ties    Egypt, Djibouti leaders discuss strengthening ties, regional issues    Egypt's FM affirms commitment to Sahel security, offers support to Niger    Egyptian banking sector support underprivileged communities in Alexandria – CBE    Afghanistan signs $163m deal for cement plant    US tightens tech investment rules for China    Biden unveils $3b investment to strengthen US port infrastructure    Military Production, Environment Ministers inaugurate banana fiber recycling plant    Luxor Museum to host exhibition on 19th century antiquities inspection tours    Nourhan Kamal Wins 2024 Helmi Sharawy Award for African Studies    Egypt observes Intl. E-waste Day, highlights recycling efforts    Egypt's military capabilities sufficient to defend country: Al-Sisi    Al-Sisi emphasises water security is Egypt's top priority amid Nile River concerns    Cairo Opera House hosts grand opening of Arab Music Festival, Conference    Grand Egyptian Museum ready for partial trial run on October 16: PM    Colombia unveils $40b investment plan for climate transition    Kabaddi: Ancient Indian sport gaining popularity in Egypt    Ecuador's drought forces further power cuts    Al-Sisi orders sports system overhaul after Paris Olympics    Basketball Africa League Future Pros returns for 2nd season    Egypt joins Africa's FEDA    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Paris Olympics opening draws record viewers    Who leads the economic portfolios in Egypt's new Cabinet?    Financial literacy becomes extremely important – EGX official    Motaz Azaiza mural in Manchester tribute to Palestinian journalists    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    Egypt records 36 new deaths from Covid-19, highest since mid June    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



COVID-19 threatens main drivers of Egypt's GDP growth: AmCham
Country's economy grew by estimated 5% in Q1 2019/20
Published in Daily News Egypt on 02 - 05 - 2020

The coronavirus (COVID-19) pandemic is posing a threat to the main drivers of Egypt's GDP growth, the American Chamber of Commerce in Egypt (AmCham) has said in recent research.
AmCham's research comes as part of a series mapping out common factors affecting key sectors based on the degree of their short- to medium-term exposure to the virus.
Egypt's GDP grew by an estimated 5% in the first quarter (Q1) of fiscal year (FY) 2019/20. Internal trade, agriculture, real estate, non- oil manufacturing and ICT drove 56% of this growth, the research said.
It also noted that, as the coronavirus crisis in Egypt emerged towards the end of Q3 2019/20, the full impacts will not be reflected in the quarter's data.
However, the sectors that drove growth early in the fiscal year are now vulnerable, which is expected to drag overall GDP growth down drastically in Q4 of FY 2019/20, the report mentioned.
In April, Minister of Planning and Economic Development, Hala El-Said, projected that the local economy will grow 4.2% by the end of FY 2019/20.
Egypt's labour-intensive industries, including agriculture, construction and real estate, have been more severely affected by the government's containment measures for the virus, the AmCham research said.
It also noted that agriculture and food processing are two of Egypt's top exporting sectors, which have been harder hit by order delays from overseas markets.
If the pandemic continues throughout 2020, global foreign direct investment (FDI) levels may also hit their lowest levels since the Global Financial Crisis of 2008-2009. This could possibly lead to a decline of up to 35%, compared to a projected growth of 5% during 2020-21 prior to the pandemic.
Egypt is a small open economy with many sectors dependent on foreign trade and heavy FDI inflows. According to the International Monetary Fund (IMF), Egypt is the Middle East and North Africa (MENA) region's only economy that is forecasted to expand in 2020.
The IMF now projects that GDP will grow only 2% in 2020, compared to earlier forecasts of 5.8% for the year, before accelerating to 2.8% in 2021.
Egypt's current account deficit is expected to widen to 4.3% of GDP by the end of the year and 4.5% in 2021, due to expected drops in foreign currency receipts. Globally, the tourism, hospitality and aviation sectors have seen a near-total halt in demand, and Egypt is no exception.
Other severely impacted sectors in Egypt are automotive assembly and auto parts, transportation and logistics, and energy, as they could see large FDI outflows and sharp falls in trade.
Egypt's banking sector is taking hits from a number of directions, including foreign currency liquidity issues. This is due to its reliance on portfolio inflows and potential threats to asset quality following significant monetary easing.


Clic here to read the story from its source.