IMF Raises Egypt's Outlook to 5.7% in 2022

The International Monetary Fund (IMF) raised on Tuesday Egypt's GDP growth rates to 5.7% in 2022 compared to 2.5% in 2021.

The IMF predicted the current account balance, the country's international transactions with the rest of the world, to reach 2.5% in 2026, expecting the unemployment rates to drop heavily in 2022, according to the Middle East News Agency.

The report added that the Asset Purchase Programme (APP), in which the Egyptian government bought a range of assets including government bonds, securities, has shown its effectiveness during the COVID-19 pandemic. The programme eased financing conditions and helped boost growth in economic activity, pushing long-term interest rates to remain low in the coming years.

The Egyptian financial performance indicators during the current FY 2020/21 showed an unprecedented improvement, as a result of the government's economic and financial reforms, where a primary surplus of EGP 25 billion have been achieved despite the negative repercussions of the coronavirus on economic activity, according to the Ministry of Finance data.

Gita Gopinath, IMF Chief Economist said the 2016 reform program had succeeded in promoting financial and monetary stability as well as building a strong cover of foreign exchange reserves.

Gopinath added that the program has strengthened the macroeconomic stability in Egypt, creating enough space to move quickly and efficiently during the outbreak.