Egypt’s economy has demonstrated recovery by recording a GDP growth rate of 4.77% in the third quarter of the fiscal year 2024/2025 as reported by the Ministry of Planning, Economic Development and International Cooperation on Monday 30 June.
This figure marks the highest quarterly growth in three years.
The robust performance has lifted the average growth rate for the first nine months of the current fiscal year to 4.2 percent, compared to just 2.4 percent during the same period last year.
Key sectors driving this growth include non-oil manufacturing, tourism, and telecommunications.
The non-oil manufacturing sector saw a growth rate of 16 percent, marking a notable turnaround from previous contractions.
This sector’s recovery is attributed to increased demand both domestically and internationally, particularly in industries like motor vehicles and ready-made garments, which experienced remarkable gains.
Tourism, another vital component of Egypt’s economy, surged by 23 percent, welcoming four million visitors during the quarter.
The telecommunications sector also contributed significantly to the economic upturn, with a growth rate of 14.7 percent.
The ready-made garments industry stood out with a growth rate exceeding 23 percent, benefiting from rising international demand.
Private investment has also accelerated, growing by 24.2 percent year-on-year. It now accounts for 62.8 percent of total executed investments.
However, the economic landscape is not without its challenges. Despite the overall positive outlook, some sectors are still facing significant difficulties.
The Suez Canal, a critical artery for global trade, reported a 23.1 percent decline in activity, affected by geopolitical tensions that have reduced vessel traffic.
The Red Sea has become increasingly dangerous for shipping due to Houthi attacks on commercial vessels, which have escalated since late 2023 in response to the war on Gaza. Major shipping companies are now rerouting their vessels around the Cape of Good Hope, avoiding the Suez Canal to ensure the safety of their crews and cargo.
The situation worsened with the outbreak of open conflict between Israel and Iran in June 2025, raising fears of broader regional instability. Ongoing unrest in Sudan further worsens security concerns, leading to increased naval operations and higher insurance premiums for ships, which discourages traffic through these vital maritime corridors.
Additionally, the extractive industries, particularly oil and natural gas, continue to struggle. Oil output contracted by 9.5 percent and natural gas extraction declined by 20.5 percent.
Looking ahead, Egypt’s government remains optimistic about sustaining this growth momentum according to sources.
The parliament approved on 18 June the Economic and Social Development Plan for FY 2025/2026, targeting a GDP growth rate of 4.5 percent.
This plan maintains a cap on public investments while emphasizing the need to redirect spending toward human capital development, particularly in health and education. Approximately 47 percent of public treasury investments will be allocated to these critical sectors.
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