World Bank revises Egypt’s GDP growth forecast down to 4.8% for FY22/23

The World Bank has on Friday revised down its projections for Egypt’s GDP growth to 4.8 percent for the financial year 2022/2023, which started last July, according to its October MENA Economic Update Report.

The forecast marks a downward revision of 0.2 percentage points from its forecast made last April, when the bank expected Egypt to grow 5.0 percent for the current fiscal year.

Egypt is outperforming most of other oil importers in the Middle East region — the exception being Djibouti, which World Bank expects an economic growth of 5.3 percent in 2023.

MENA’s net oil importers are seeing “heightened stress and risk” to their economies due to “higher import bills, especially for food and energy, and from the depreciation of local currencies in some countries,” the report read.

Debt service burdens are growing for oil importers, including Egypt, Jordan, and Tunisia, as global interest rates are on the rise with the wave of monetary tightening, the report added.

These countries are also facing increased expenses from inflation mitigation programmes (think food + energy subsidies and cash transfer programmes such as Takaful and Karama here in Egypt), which the World Bank said require them to “cut other expenditures, find new revenues, or increase deficit and debt” to continue financing.