CAIRO: The International Monetary Fund (IMF) predicted that Egypt would only see a 1.5 percent growth in GDP for 2011, according to its World Economic Outlook report that was delivered last week. A growth rate of 1.5 percent means that Egypt's economy is growing at one-fourth the rate it did in 2010, when annual GDP growth neared four percent. The report predicted a growth of just 2.5 percent for 2012, expecting a continued stall in investments and a drop in foreign reserves. The World Economic Outlook report divided the Middle East and North Africa into two categories: oil exporters and oil importers. It stated that states in the latter group—namely Egypt, Tunisia and Syria, will be hit the hardest economically. “For the oil exporters … we expect them to have strong fiscal and current account balances, but the opposite holds true for countries that are importing commodities, and those undergoing very protracted political transition to stability,” said Rupa Duttagupta, Deputy Division Chief of the IMF's World Economic Studies Division, to the press on Tuesday. Syria is expected to perform the worst economically for the region, according to the report. After 6 months of unrest, GDP is expected to shrink two percent for 2011. Previous to the protests, the IMF expected Syria's GDP to grow by three percent. Syria's economy was particularly hard hit when the EU imposed an oil export ban last August. Oil exports to the EU once accounted for 12 percent of Syria's budget. The IMF's report stated that oil-exporting countries would not go unscathed amid the current regional and global economic crisis either. Saudi Arabia's GDP growth is expected to slow from 6.5 percent this year to just 3.6 percent in 2012. Regardless of these dire national and regional economic forecasts, Egypt refused loan offers from the IMF and the World Bank last June, vowing to tackle its fiscal problems through regional loans and foreign direct investment. Regional powers have continued to work together to bolster regional ties and aid economies suffering in the outset of the Arab Spring. Egypt is expected to receive about $500 million from the Arab Monetary Fund and another several billion in loans from Saudi Arabia and the United Arab Emirates to aid in its budget deficit for the year. BM
