Egypt’s government has remained too optimistic in its economic growth forecast, a tendency that has not changed after the revolution.
The government's official forecast for economic growth in the fiscal year ending June 2014 is 3.5 percent.
However, regional investment bank Prime Holding estimates that it will not exceed 2.7 percent.
Even gloomier is that of the World Economic Outlook (WEO), which projects an annual growth of a mere 1.8 percent.
Prime says that it is expecting slower growth for many reasons. One is a slowdown in private consumption, normally a traditional rescuer of the Egyptian economy.
Stagnating real incomes, however, combined with staggering unemployment and soaring inflation, not to mention ongoing street violence, have more than halved private consumption, which dropped down from 6.5 to 2.8 percent this year.
Prime also believes that the government will not reach the targeted investments and thus expects a 1.5 percent drop in exports.
The Egyptian government has insisted that it will keep the budget deficit at less than 10 percent through a stimulus package of LE30 billion ($4.3 billion).
Prime researchers have declared this estimate to be wholly unrealistic, however, putting the expected deficit closer to 13.9 percent.
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