The World Bank expects that the gross domestic product will record 5% in 2018 and 5.5% in 2019 in a document consulted by Reuters.
The inflation rate will reach 14% in 2019
At first, the World Bank in its report of the Economic Observatory for the Middle East and North Africa predict that Egypt will record a growth rate of 4.5% in 2018 and that this rate will rise to 5.3 % in 2019. But the institution upgraded its expectations and bet now that the economic growth will reach 5% in 2018 and 5,5% in 2019. But it’s not the only prediction. Indeed the World Bank predicted that the inflation rate will reach 14 % in 2019 and will decline to 12 % in 2020.
For the Central Agency for Public Mobilization and Statistics (CAPMAS), the annual consumer price inflation slipped to 13.1 % in March 2018, compared to 32.5 % in the same month of 2017.
The World Bank added that with the momentum of reforms in the Egyptian economy, economic activity is expected to improve and distortions will be greatly reduced, adding that flexibility of private consumption and private investment will be the incentive of growth, in addition to a gradual improvement in exports, “especially from the tourism and gas sectors”. Indeed the country bet a lot on Zohr gas field and will plan to invest “ $ 25 billion in 16 gas and oil projects in the Mediterranean “ according to Egyptian oil minister Tarek El Molla.
Egypt had embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT) and cutting energy subsidies, all with the aim of narrow the budget deficit.As an example, the country aims to raise its revenues from Tobacco taxes by $402 million in the 2018-2019 draft budget.
The country floated its currency in November 2016 before it clinched a $12 billion loan from the International Monetary Fund (IMF).
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