IMF cuts forecast for Egypt’s 2020 GDP growth to 2% due to coronavirus

The International Monetary Fund (IMF) has trimmed its 2020 forecast for Egypt’s real GDP growth to 2 percent as the impact of the coronavirus pandemic weighs heavily on emerging markets, the Washington-based lender said on Tuesday.

However, Egypt’s economy is expected to maintain a positive growth of 2.8 percent in 2021, the Fund said in its World Economic Outlook Report Chapter 1: The Great Lockdown.

The Fund projected that consumer prices, which set the inflation rate, will reach 5.9 percent throughout 2020, and up to 8.2 percent in 2021.

Egypt’s current account balance is forecasted to decelerate by 4.3 percent in 2020, and by 4.5 percent in 2021, in comparison with a fall of 3.6 percent in 2019, the report added.

The unemployment rate in the North African country is projected to record 10.3 percent in 2020, up from 8.6 percent in 2019, and to go up to 11.6 percent in 2021, according to the IMF report.

The IMF forecasted that the global economy would likely suffer this year the worst financial crisis since the Great Depression, saying the governments grapple with the pandemic.

“It is very likely that this year the global economy will experience its worst recession since the Great Depression, surpassing that seen during the global financial crisis a decade ago,” IMF chief economist Gita Gopinath said in the report.