The Egyptian market experienced a “roller coaster ride”in 2019 that saw a wide range of “booms and busts” that are being addressed by the government in line with Egypt Vision 2030, according to JLL.
Following a positive start to 2019, most sectors of Cairo’s real estate market remained soft by the end of Q4, with the government currently undertaking extensive strategic plans to stimulate growth and drive investment opportunities.
The report also highlighted how the Central Bank of Egypt’s (CBE) move to consecutively cut key interest rates last year proved positive, as a slow recovery in consumption levels and lower debt interest payments were brought about in response to mitigating imbalances over the year.
“The year 2019 was intriguing on so many levels for Egypt. It will be remembered as a year which saw our country addressing a wide range of changes and challenges right across the real estate sector,” said Ayman Sami, JLL’s Country Head – Egypt office.
“The good news is that after the shock of fuel subsidy reforms wore off, and with price pressures alleviated in recent months, we are expecting domestic demand to strengthen in the forthcoming period.”
Ease of doing business
The report highlights how the Egyptian government is undertaking plans to ease doing business, lure more foreign direct investments, reinforce the role of the private sector through partnerships (PPPs), and enhance the country’s overall investment climate.
Importantly, according to the report, are the efforts that are being undertaken to export Egypt’s real estate abroad, with Egypt participating in MIPIM 2020, regarded as one of the world’s leading real estate market events, for the second time in a row. Egypt will also participate in Dubai Expo 2020 to promote its investment, commercial and service sectors.
“The real estate sector is a main driver of Egyptian economic growth,” said Mr. Sami. “These key initiatives will achieve positive results and will help boost demand in the medium and long-term.”
Egypt 2030 Vision
Egypt’s parliament also approved the FY 2019/20 budget with spending set at EGP 1.6 trn ($96bn), up EGP 150 bn compared to last year, marking the biggest state budget in the country’s history.The new budget will support local development sectors, with an unprecedented uplift to be pumped into the health and education industries as well.
“The government is committed to achieving the goals of Egypt Vision 2030, with a special focus on sustaining urban development, while bolstering the advancement of Upper Egypt,” said Mr. Sami.