Brooks made her remarks in response to an Ahram Online question about the key drivers behind the IMF's updated forecasts for the Egyptian economy in the latest edition of the Fund's flagship World Economic Outlook. She spoke during a virtual press briefing held by the IMF on Wednesday.
Speaking to Ahram Online, Brooks said the IMF raised Egypt's growth forecast for the current fiscal year to 4.6 percent, up 0.4 percentage points from its April projections, reflecting stronger economic performance than previously anticipated.
However, the Fund lowered its FY2026/27 growth forecast by 0.4 percentage points to 4.4 percent, saying the conflict's effects are expected to become more pronounced over time.
Brooks attributed the weaker outlook to lower investment, higher financing costs, and elevated uncertainty, all of which are expected to weigh on economic activity.
Conflict affects MENA economies unevenly
Separately, Deniz Igan said the conflict continues to have uneven consequences across Middle East and North Africa (MENA) economies, with oil-exporting countries directly affected by the hostilities experiencing the sharpest economic slowdown.
She said the IMF's downward revisions for those economies reflect prolonged disruptions to oil, gas and refining production, in addition to weaker activity in non-oil sectors, including logistics, transport, tourism and trade. Although spare production capacity has provided some support, it has not fully offset the loss of oil exports.
For oil-importing economies, including Egypt, revisions were more limited and varied from country to country, reflecting differences in economic resilience earlier this year and the extent of their dependence on neighbouring oil-exporting economies, Igan added.
AI investment creating new growth divide
Brooks also said the economic effects of the regional conflict and the global artificial intelligence (AI) investment boom are unfolding very differently across countries, creating increasingly divergent growth paths.
According to the IMF's latest projections, oil-exporting economies—many of them directly affected by the conflict—have seen the largest downward revisions due to the war's economic impact.
At the same time, energy-importing countries that remain outside the global AI investment value chain, many of them low-income economies, continue to face weaker growth prospects and more persistent economic scarring.
By contrast, countries integrated into the AI-driven technology investment chain, including South Korea and Thailand, have seen their growth forecasts revised upward. Commodity-exporting economies that have avoided the direct impact of the conflict have also enjoyed improved growth prospects.
Brooks said the contrasting trends highlight an increasingly uneven global recovery, with geopolitical tensions and AI-led investment emerging as key forces reshaping economic growth across countries.
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