The International Monetary Fund (IMF) has maintained its forecast for the Egyptian economic growth at 5.2% for fiscal year (FY) 2021/22. The Fund expected the same rate earlier in July after the completion of its second review for Egypt's economic reform programme, supported by the IMF Stand-By Arrangement (SBA) and the 2021 Article IV Consultation on 23 June. This expectation was lower than what the fund had projected in its April report of 5.7%. Meanwhile, the Egyptian government expects to achieve a 5.4% growth in FY 2021/22. Additionally, the IMF upward revised its forecast for the Egyptian economy's growth to 3.3% in FY 2020/21, compared to 2.5% and 2.8% it had expected in April and July, respectively. Notably, Hala El Said, Minister of Planning and Economic Development, said that local indicators showed that the Egyptian economy would achieve 3.3% growth in FY 2020/21. The Fund expected that the Egyptian economy will continue to grow to 5.8% in FY 2025/26. The IMF raised its expectations for the average inflation rate this year to reach 4.9%, compared to 4.8% it had expected in April. The Fund improved its forecast for the unemployment rate this year to 9.2% from 9.4%. As for the Middle East and Central Asia region, the report expected that the region's real GDP would grow by 4.1 % in both 2021 and 2022. "Meanwhile, compared to our July forecast, the global growth projection for 2021 has been revised down marginally to 5.9% and is unchanged for 2022 at 4.9%. However, this modest headline revision masks large downgrades for some countries," IMF Chief Economist Gita Gopinath said in a press conference on Tuesday. "However, this modest headline revision masks large downgrades for some countries. The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics. The downgrade also reflects more difficult near-term prospects for the advanced economy group, in part due to supply disruptions. Partially offsetting these changes, projections for some commodity exporters have been upgraded on the back of rising commodity prices. Pandemic-related disruptions to contact-intensive sectors have caused the labour market recovery to significantly lag the output recovery in most countries," she added.
