With the economy increasingly strapped for foreign currency, the government has been seeking ways to increase the private sector’s contribution to GDP. In May 2022, it published the State Ownership Policy (SOP) document, which opens the door for the government to sell stakes in 32 state-owned companies by 2024 by listing them on the stock exchange or selling them directly to foreign investors. Prime Minister Mostafa Madbouly has said the sell-off would raise the private sector’s contribution to GDP from 30% to 65% in three years. In December, he told Al Ahram English the aim is to “increase the rate…
Author: Rania Hassan
It’s official: Inflation in Egypt is the highest since records began in the 1950s. In June, it reached an annual rate of 35.7% compared to 32.7% in May. Core inflation, which excludes energy and food, reached 41%. Analysts speaking to Reuters forecast the record reading, citing an “unfavorable base effect” since the previous year and greater demand during the Eid al- Adha holiday. Amplifying domestic inflation is the Central Bank (CBE) keeping its overnight interest rate at 18.25% (The second highest since 2017) since April. That and inflation negatively affect GDP growth prospects, deflating consumer sentiment. “Real GDP growth is…
Digital transformation across the Arab World is driving GDP growth, finding solutions for incumbent problems, and creating new investment and job opportunities. “The Arab region has experienced remarkable growth and transformation across all sectors with the support of digital transformation,” the Information Technology Union (ITU), a UN agency, said in September. “Governments in the region have launched ambitious … plans [to create] an inclusive and sustainable digital economy for their citizens.” The next step is allowing artificial intelligence (AI) and machines that “learn and adapt without following explicit instructions” to recommend actions and make decisions. A PricewaterhouseCoopers report estimates AI…
Having enough electricity from a reliable and sustainable supply is an increasingly necessary prerequisite for GDP growth and meeting society’s demands. The International Energy Agency (IEA) stressed in a note, “While it only accounts for a fifth of primary energy use today, [electricity] is indispensable for the 24/7 … economy.” The importance of a reliable supply came into the spotlight in 2020. “Difficulties caused by the COVID-19 pandemic remind us of the critical importance of electricity in all aspects of our lives, such as keeping medical equipment working in hospitals and IT systems available for teleworking and video conferencing,” the…
As with many sectors in 2023, infrastructure development is seen by international investors as on the threshold of an unprecedented transformation. This year may represent “an epoch unlike any other,” said a KPMG report titled Emerging Trends in Infrastructure, 2023 Edition. “Future generations may look back at 2023 with deep admiration or deep scorn,” it said Driving that transformation is not technology but decisions by government officials and businesses. Future generations “may praise leaders for their foresight or damn them for their inactions,” KPMG’s report said. Attracting international infrastructure investment is vital for Egypt. In November, Minister of Planning Hala…
Summary: A report from the Egyptian Center for Economic Studies on Egypt’s labor force setup. Egypt’s attempts to keep GDP growth rates positive since the January 2011 revolution, the July 2013 uprising, the first float of the pound at the end of 2016, and the COVID-19 pandemic have affected the labor market. “Over the past decade, the Egyptian economy has undergone significant negative structural shifts, skewing job creation toward lower productivity sectors,” a December report from the Egyptian Center for Economic Studies (ECES) said. “COVID-19 has further revealed Egypt’s labor market bottlenecks, vulnerabilities and segmentation.” Local and foreign investors starting…
Since the start of the war in Ukraine in February 2022, Egypt has seen rapid price jumps across the board. Global commodity prices, inflation, currency exchange rates and interest rates are at all-time highs. That invariably affects housing prices. Global Property Guide, a real estate data curation portal, found real estate prices in Egypt (discounting inflation) rose by nearly 58% between January 2022 and 2023 — adjusted for inflation, the increase was almost 34%. A significant portion of those increases is due to more expensive building materials. Published research from the Faculty of Engineering in Mansoura estimated 60% to 70%…
Egypt’s government has ambitions to significantly increase eco-friendly (green) investments. Hala El-Said, the minister of planning and economic development, announced plans for government-led green projects to account for 30% of all state projects by 2030. The government also is talking up incentives for private sector eco-friendly projects. Egypt has most of the necessary resources and political will to realize its green goals. Andrew Forrest, executive chairman of Fortescue Future Industries, a green energy company, told fDi Intelligences, a specialized portal, in October, “Egypt is on the way to becoming a global powerhouse in the green energy value chain.” Supporting those…
With uncertain global economic forecasts, employees increasingly seek to improve their prospects of moving to better jobs or at least keeping their current ones. In January, WellRight, a provider of wellness programs to companies, said in its blog: “In 2023, a crucial must-have for candidates and employees alike will be the freedom to explore career advancement opportunities as the job market evolves.” That means seizing all opportunities to improve their skill sets and knowledge. A 2021 Boston Consulting Group (BCG) report found 65% of workers were spending more time than ever learning skills that can translate to various opportunities. Attaining…
Currency exchange rates, lending and GDP growth prospects worldwide are affected by what the U.S. Federal Reserve (Fed) decides during the eight times it meets annually to determine interest rates. “Interest rates in the U.S. economy … influence interest rates throughout the global economy as a whole,” said Brian O’Connell, a contributor to Forbes, in February. “The [Fed’s] mission is to keep the U.S. economy humming — not too hot, not too cold, but just right.” Interest rates in the United States increased from 0.5% in January 2022 to 4.5% by the end of the year to combat inflation, which…