IMF sees Egypt’s growth slowing to 4.2% in 2026 on regional spillovers

Egypt’s economic growth is projected to slow to 4.2 per cent in 2026 before recovering to 4.8 per cent in 2027, the International Monetary Fund (IMF) said, cutting its medium-term outlook by a cumulative 1.1 percentage points.

The revision comes in the IMF’s latest World Economic Outlook, which highlights the impact of heightened regional instability following the outbreak of war in the Middle East in early 2026.

The Fund said the downgrade reflects spillovers through commodity markets, inflation expectations, and tighter global financial conditions, which are expected to weigh on emerging markets, including Egypt.

Under its reference forecast, the IMF assumes the conflict remains limited in duration and scope and fades by mid-2026, in line with market pricing of commodities as of 10 March.

Even so, it warned that uncertainty remains elevated, with alternative scenarios pointing to deeper and more prolonged disruptions if hostilities persist or expand.

Egypt’s economy has recently benefited from improved financial conditions and investment inflows, but remains sensitive to external shocks, particularly energy prices and capital flows.

The IMF said earlier global tailwinds from technology investment and easier financial conditions are now being partially offset by geopolitical risks in the Middle East.

Attribution: Amwal Al Ghad English