Part of the press conference the World Bank organized in Cairo. Al-Ahram
Speaking to Ahram Online on the sidelines of a conference organized by the bank in Cairo to launch its global and regional economic outlook, Carla Slim, an economist at Standard Chartered MENA, noted that the recent US tariffs are unlikely to significantly affect trade between Egypt and the US, given that the US maintains a trade surplus with Egypt.
"Egypt's geographic location, particularly its control over the Suez Canal, plays a crucial role in global trade dynamics," Slim said. "We predict that the canal may see increased traffic despite ongoing tensions in the Red Sea, driven by a rise in South-South trade, which refers to economic exchanges between emerging markets."
Mohamed Gad, CEO of Standard Chartered in Egypt, told Ahram Online that the evolving tariff landscape presents an opportunity for Egypt to position itself as a global trade hub, particularly for Asian economies, thanks to its infrastructure and relatively low operating costs.
During the conference, Slim also shared the bank’s updated projections for Egypt’s exchange rate, forecasting it to reach EGP 52 per USD in 2025, rising further to EGP 54 per USD in 2026.
Explaining the key drivers behind this outlook, Slim cited a range of factors influencing foreign exchange inflows and outflows.
"Continued support from international financial institutions such as the International Monetary Fund (IMF) and the World Bank is expected to bolster Egypt’s FX reserves, with additional disbursements from the European Union — as part of the $8 billion financing package — also expected to contribute positively," she explained.
She added that while there are risks of capital outflows, indicators suggest that portfolio inflows may increase, offering a degree of balance.
"The overall balance between FX inflows and outflows has contributed to relatively low volatility in the Egyptian pound. Analysts note that the exchange rate has remained stable, fluctuating between EGP 50 and EGP 52 to the dollar since the beginning of the year. Any significant increase in canal revenues could support appreciation, while potential outflows might trigger some depreciation,” Slim added.
Slim also stated that the bank expects the Central Bank of Egypt (CBE) to begin cutting key interest rates at its upcoming meeting scheduled for 2 May. The forecast for the total rate cut has been revised upward to 2 percent, from a previous projection of 1.5 percent.
On inflation, Slim said the rate is expected to slow to between 10–15 percent in 2025, despite the recent increases in retail fuel prices. She clarified that while the annual inflation rate is expected to decelerate, the monthly rate may still show slight increases.
Slim added that Egypt's real GDP growth is projected to recover to 4.5 percent in 2025, before rising to 6 percent in 2026.
She also expressed optimism about the trajectory of Egypt’s net foreign reserves and the CBE’s foreign assets, both of which are expected to continue increasing.
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