'Egypt's growth rate to record 5.5% in FY 2019/20 thanks to strong fiscal reforms': World Bank report

Doaa A.Moneim , Monday 14 Oct 2019

For the MENA region, the bank's annual report anticipated a modest 1.5 percent growth in 2019, down from 1.6 percent in 2018, largely due to weaker global growth and global financial market volatility

World Bank
File Photo: Egypt will be affected by global market performance: World Bank senior economist says (Photo: AFP)

Egypt's strong reforms on the fiscal and energy fronts can help its growth rate reach 5.5 percent in FY 2019/2020, according to the World Bank (WB) annual report.

The bank's projection for Egypt came in Sync with the Egyptian government's own announced target of 5.6 percent growth for this year.

The WB explained that it disbursed $62.3 billion in 2018 in loans, grants, equity investments, and guarantees to partner countries and private businesses in developing countries.

Sub-Saharan Africa took the lion's share of these expenditures with $18.4 billion, while the Middle East came in second with $8.2 billion.

For the Middle East and North Africa, the report mentioned that growth in the region is anticipated to be a modest 1.5 percent in 2019, down from 1.6 percent in 2018, largely due to weaker global growth and global financial market volatility.

Real per capita growth across the region will be 0.1 percent, improving slightly on 2018’s decline of 0.2 percent.

"Conflict continues in the Republic of Yemen and Libya and, though diminished, in Syria as well. This has contributed to an increase in the region’s extreme poverty rate, which nearly doubled from 2.7 percent in 2011 to 5 percent in 2015. Iraq’s recovery and reconstruction efforts are moving forward, if slowly," the report said.

The World Bank, according the report, approved $5.5 billion in lending to the region over 19 operations in fiscal 2019, including $4.9 billion in International Bank for Reconstruction and Development (IBRD) loans and $611 million in International Development Association (IDA) commitments.

Revenue from Reimbursable Advisory Services agreements, including with countries from the Gulf Cooperation Council (GCC), was around $56 million.

"Our regional strategy has the promotion of peace and social stability at its core. It has expanded since 2018, with added focus on mobilizing finance for development, human capital, and digital development. It retains the four pillars of forging a new social contract; increasing regional cooperation; building resilience, including addressing the challenges of forcibly displaced people; and supporting recovery and reconstruction. The expanded strategy incorporates the Bank’s three priorities of sustainable and inclusive growth, investment in human capital, and strengthening resilience. Many of our activities include more than one of these pillars, as well as the new areas of focus," the report said.

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