This would put Egypt in second place in the MENA region after Libya in terms of the real GDP growth, according to the report.

Moreover, the report expected Egypt’s real GDP growth to be the highest among MENA’s economies through during 2024-2028.

The Egyptian government has revised down its forecasts for the country’s real GDP growth during the current fiscal year, which ends in June. The latest revision announced in December puts the figure at 3.5 percent, compared to 4.2 percent projected a month earlier.

The decline was mainly due to the consecutive external shocks and disturbances that hit the country’s economy, including the geopolitical tensions in the Middle East and the repercussions of the war in Ukraine.

Exchange rate
 

The Egyptian market is anticipating a fourth devaluation of the Egyptian pound against the US dollar. The three previous devaluations has caused the local currency to lose over 75 percent of its value since March 2022.

The US dollar official rate is currently trading for almost EGP 31 / 1 USD, while the rate in the parallel market exceeds EGP 52 / 1 USD.

Inflation
 

For the country’s average inflation in 2024, the BMI report lowered its projections to 26.7 percent, down from 27.4 percent it expected a month prior.

As per the report’s data, Egypt is anticipated to suffer the third highest inflation rate in the MENA region after Lebanon (115 percent), and Iran (36.8 percent).

The data also showed that Egypt’s inflation to be the highest in the region through 2028.

Egypt’s annual headline inflation cooled to 36.4 percent in November, down from 38.5 percent a month prior, according to the latest data released by the Central Agency for Public Mobilization and Statistics (CAPMAS). CAPMAS is expected to announce the new inflation readings this week.

Meanwhile, the calculations of the Central Bank of Egypt (CBE) showed that the country’s annual core inflation rate cooled by 2.2 percent in November, reaching 35.9 percent, down from 38.1 percent seen in October.

“We expect economic growth in the MENA region will accelerate from two percent in 2023 to 2.9 percent in 2024. MENA, along with Sub-Saharan Africa, will be the only regions globally to post faster year-on-year growth,” said the report.

The report also noted that BMI’s current MENA growth is slower than the 3.2 percent it expected

in September 2023 due to the OPEC+ November 30 measures, the spillover of the Israel-Hamas war on the Levant and country specific factors in Tunisia and Egypt.

The acceleration in MENA growth in 2024 will be mainly driven by a stable oil production and robust non-oil economy in the Gulf Cooperation Council (GCC) countries and the post-war recovery in the Levant, according to the report.

Furthermore, the report predicted North Africa to remain broadly unchanged in terms of the GDP growth on annual basis.

“While most MENA countries will see faster growth in 2024, more than half of the region’s economies will grow below historical trend,” the report stressed.