Egypt’s economy grew by 4.4 per cent during the 2024-25 fiscal year, surpassing the 4.2 per cent target set in the state budget and the 2.4 per cent growth recorded in 2023-24, according to the quarterly GDP bulletin issued by the Ministry of Planning and Economic Development.
The ministry stated last week that the non-oil manufacturing sector had achieved an annual growth rate of 14.7 per cent in the past fiscal year, compared to a contraction of around six per cent in the corresponding period the year before.
Moreover, the ICT sector had grown by 13.8 per cent.
The overall growth was primarily driven by the tourism sector’s expansion by 17.3 per cent, making it the fastest-growing sector, the bulletin said. The hike was supported by substantial investments in tourism infrastructure, an increase in hotel capacity, and the depreciation of the pound against the dollar.
The rise in exports followed by the floatation of the pound in the third quarter of last year led to substantial growth in the non-oil manufacturing, ICT, and the tourism sectors, said Hani Genena, head of research at Al Ahly Pharos.
The floatation of the pound made Egyptian products more competitively priced, and this had increased demand, with tourism being the first sector to benefit, he said.
Tourism is expected to grow further, particularly with the approaching inauguration of the Grand Egyptian Museum (GEM), Genena added. He expected the industrial sector to continue to grow as well, with many factories seeking to expand their operations abroad, either through increased exports or by establishing production lines overseas.
Several industries are now focused on exporting, including cement, which had ceased exports in recent years but is expected to export 17 million tons out of a total production of 70 million tons this year, he said, noting that exports of dairy and food products are also rising strongly.
According to a report by the Ministry of Planning, the non-oil manufacturing sector has recovered from a contraction in 2023-24 to become the largest contributor to GDP growth this year.
“This was the result of the facilitation measures introduced this year, including the easing of customs clearance procedures for industrial goods and increased investment in the manufacturing sector,” the report stated.
It added that providing subsidised loans to priority sectors and supporting small and medium-sized enterprises (SMEs) had also contributed to the sector’s revival.
Genena pointed out that the ICT sector has been seeing substantial investments from the government and private sector to promote financial inclusion. The sector has been generating large profits through companies such as Fawry and e-Finance, in addition to growing outsourcing companies.
He noted that Egypt’s youthful workforce that has proficiency in multiple foreign languages and relatively low labour costs has encouraged many European companies to establish regional offices in Egypt.
Sara Saada, a senior economist at CI Capital, believes that the tourism sector is likely to continue leading economic growth, with Egypt now attracting visitors year-round rather than during specific seasons.
She added that the manufacturing sector is also expected to grow, especially as the Central Bank of Egypt (CBE) has lowered interest rates, which will help the manufacturing sector to expand and sustain its activity.
Moreover, there is growing demand for investment in the Suez Canal Economic Zone and various free zones, which has had a positive impact on the balance of payments, she said.
A CBE balance of payments report said that this improvement was particularly evident in the third quarter (January to March 2025), when the deficit narrowed by 69.3 per cent compared to the corresponding quarter the year before.
The improvement was driven by an 86.6 per cent increase in remittances from Egyptians working abroad, along with a rise in the services surplus due to a 23 per cent increase in tourism revenues.
The sustained growth of these sectors, Saada said, depends on the continuation of government incentives, with political stability being the key factor for tourism.
Mohamed Hassan, managing director of the Alpha Company, concurred, noting that overall economic stability, particularly the stabilisation of the exchange rate, enhances the prospects for continued growth.
He added that such stability particularly benefits the industrial sector, especially with the CBE expected to continue reducing interest rates. He expects more tourists to come to Egypt by the end of the year, in time for the inauguration of the GEM.
On a quarterly basis, the economy expanded by five per cent in the fourth quarter of the 2024-25 fiscal year, more than double the growth rate recorded in the same period a year earlier, which stood at 2.4 per cent.
The World Bank also raised its growth forecasts for Egypt’s economy for the current and upcoming fiscal years. It upgraded its projection for the current year to 4.3 per cent, an increase of 0.1 per cent from its June estimate, and it expects the economy to grow by 4.8 per cent in the next fiscal year, 0.2 percentage points higher than its previous forecast.
* A version of this article appears in print in the 16 October, 2025 edition of Al-Ahram Weekly
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