Egypt’s Minister of Finance Mohamed Maait announced, on Thursday, that his Ministry prepared a report on the country’s economic performance during 2020.
According to the “Challenge and Achievement” report, if it had not been for the economic reform programme, the country would not have succeeded in containing the repercussions of the novel coronavirus (COVID-19) crisis and mitigating the severity of the global shock.
Egypt, as stated by Bloomberg, would be among the 10 fastest growing economies in the world during 2020, and record the second highest economic growth rate in the world by 3.6%, according to the International Monetary Fund (IMF).
The Minister indicated that the debt-to-GDP ratio declined from 108% in the fiscal year (FY) 2016/17 to 88% in FY 2019/20, with a primary surplus of 1.8% in the last FY.
Maait pointed out that positive outlook of the Egyptian economy issued by international institutions reflected the resilience of the local economy. The World Bank, on the sidelines of its annual meetings, described Egypt as a “bright spot” in Africa, after foreign direct investment (FDIs) increased by 11% during FY 2019/20, compared to previous years.
He also referred to Egypt’s improved ranking on the Ease of Doing Business index, issued by the World Bank, climbing 14 places over the past two years.
Moreover, according to JP Morgan, Egypt is the only country in the Middle East and Africa that successfully concluded the annual cycle of reviewing credit ratings and maintained the confidence of all three global credit rating institutions: Standard & Poor’s, Moody’s, and Fitch, during one of the most difficult periods witnessed by the global economy.
The IMF also believes that Egypt will be the only country to achieve positive economic growth in the Middle East and North Africa (MENA) region during FY 2020/21. The Fund expects a rapid recovery of the Egyptian economy in the medium term, and an increase in growth rates of more than 5%.
Additionally, the IMF expects that the deficit-to-GDP ratio will decline to 5.1% in Egypt during FY 2022/23, and 4.4% in FY 2024/25, reflecting the ability of Egyptian financial policies to deal positively and effectively with local and international variables, according to the minister.
Maait indicated that, according to IMF estimates as well, the state budget will achieve an initial surplus of 0.5% of GDP during FY 2020/21, rising to 2% in FY 2022/23, and continuing this approach at 2% growth rate on average until 2025.
Egypt also ranked, according to a Deutsche Bank, the fifth largest concentration for foreigners and the third largest decline in interest rates, according to the minister. He added that such reports reflect the success of the economic reform programme in creating a healthy environment for doing business and raising efficiency of public finance.