Hala El-Said, Minister of Planning and Economic Development, reviewed on Wednesday the initial indicators of the Egyptian economy performance during the first quarter (1Q) of fiscal year (FY) 2021/22.
During a cabinet meeting, the Minister said that the initial indicators showed that the Egyptian economy achieved a growth rate of 9.8% during 1Q FY22, which is the highest quarterly growth rate over the past two decades. This FY confirms the improvement in the performance of the economy, and the trend towards recovery from the pandemic.
The minister added that the annual growth rate is expected to continue its rise, ranging between 5.5% and 5.7% by the end of FY22, driven by the boom in growth rates in the first quarter.
Various economic activities succeeded in achieving positive growth rates during 1Q FY22. The restaurants and hotels sector achieved the highest quarterly growth rate of about 181.8%, reflecting the remarkable recovery of this sector after the repercussions of the pandemic.
The Suez Canal also achieved a growth rate of 20% during the first quarter of the fiscal year 2021/2022, with a significant recovery compared to the same quarter of the previous year, due to the increase in the canal’s revenues, the number of ships and tonnage, and the telecommunications sector maintained high growth rates as it achieved a growth rate 16.3% as a result of the increase in high-speed internet users, fixed-line subscribers, and the increase in data services revenues as a result of investment in digital infrastructure.
The minister explained that the manufacturing sector achieved the highest quarterly growth rate of 15.2% during the past two decades, after shrinking by 12.7% during the same quarter of the previous year, as a result of the improvement in the activities of the paper, pharmaceutical, beverages, and clothing industries. Moreover, the construction sector reported a growth rate of 10.5% in 1Q FY 2021/22, compared to 2.6% in the corresponding period of FY 2020/21. This is due to the increase in the value of the investments of the New Urban Communities Authority, which led to an increase in production in the construction sector and an increase in investments directed to economic activities.
El-Said also discussed the contributions of various economic activities to the gross domestic product during 1Q FY22, explaining that the most contributing sectors are: manufacturing, agriculture, trade, and real estate.
The Minister indicated that the rate of individuals’ participation in economic activity increased to 43.7% during 1Q FY22, compared to 41.1% in 1Q FY21.
With regard to indicators of the performance of the financial and monetary sector, the minister indicated that the inflation rate increased in September, reaching 8.0% on an annual basis, while it reached 1.6% on a monthly basis, as a result of the rise in international prices of energy, food commodities, and minerals. In addition, the exchange rate continued its decline since September 2019, reaching EGP 15.7 per dollar in September 2021, and the foreign exchange reserves continued to rise for the 16th consecutive month, reaching $40.8bn in September 2021.