Egypt’s Economic Growth Surges to Three-Year High Amid Reforms and Sectoral Recovery

Egypt’s economy grew by 4.77 percent in the third quarter of fiscal year 2024/2025, marking its fastest quarterly expansion in three years, driven by strong recoveries in non-oil manufacturing, tourism, and telecommunications, according to official government data released this week.

The Ministry of Planning, Economic Development, and International Cooperation said the surge in growth — more than double the 2.2 percent recorded in the same quarter a year earlier — brought average GDP expansion for the first nine months of the fiscal year to 4.2 percent. This has already surpassed full-year growth expectations and suggests that final figures could exceed the government’s 4 percent target.

“This performance highlights the resilience of the Egyptian economy and the strength of our ongoing reform agenda,” said Planning Minister Dr. Rania Al-Mashat. “Despite global uncertainties, we are building momentum toward sustainable, private sector–led growth.”

The recovery follows years of economic strain, including pandemic-related shocks, a steep currency devaluation, and high inflation. After securing an $8 billion IMF-backed bailout in early 2024, Egypt floated its currency — leading to a 38 percent depreciation — and raised interest rates sharply to stabilise macroeconomic conditions.

Key sectors have since shown renewed strength. Non-oil manufacturing output grew by 16 percent in the third quarter, reversing a 4 percent contraction a year earlier. Particularly strong gains were seen in motor vehicle production (up 93 percent), ready-made garments (58 percent), and textiles (17 percent). The sector contributed nearly 2 percentage points to GDP growth, while exports of finished goods rose 12.7 percent year-on-year.

Tourism also saw a sharp rebound, expanding 23 percent as visitor numbers reached 4 million and total tourist nights climbed to 41 million. The telecommunications sector grew by 14.7 percent, while financial intermediation rose 17.34 percent.

On the demand side, net exports contributed 2.7 percentage points to overall growth, with exports surging 54.4 percent and imports up 18.7 percent. Private investment rose by 24.2 percent, accounting for nearly two-thirds of total investment, while public investment fell 45.6 percent — dragging total investment’s contribution to growth into negative territory.

Despite the positive momentum, challenges remain. Extractive industries contracted by over 10 percent due to falling oil and gas output. Suez Canal revenues also dropped 23.1 percent, reflecting disruptions from ongoing regional tensions.

Still, Egypt has maintained its growth outlook. The government projects GDP expansion of 4.5 percent in fiscal year 2025/2026, backed by a new development plan prioritising health, education, and social services while capping public investment at 1.158 trillion Egyptian pounds.

The World Bank forecasts Egypt’s growth will stabilise around 4.2 percent by 2025, supported by structural reforms, tourism recovery, and private investment — signs that the economy may be turning a corner despite external headwinds.