Egypts GDP growth forecast to reach 5.5% in 2021: World Bank

ArabFinance: The World Bank (WB) has raised its forecasts for Egypts real gross domestic product (GDP) to 5.5% for 2021, compared to 4.5% predicted in June before hitting 6% in 2022, according to a recent report by the WB.

The World Bank expounded that the performance of oil-importing countries (OICs) in the Middle East and North Africa (MENA) has been dominated by the recovery of Egypts economy, which accounts for more than half of this groups GDP.

The report estimated the cumulative cost of the pandemic on the MENA regions GDP in 2021 is expected to be around $200 billion.

These costs are calculated by comparing where the regions GDP would have been if the pandemic had not hit. According to the report, the regions GDP contracted by 3.8% in 2020 and is forecast to grow by 2.8% in 2021, the report said.

Additionally, the report projected the MENA regions GDP to grow by 4.2% in 2022.

The bank also predicted that most MENA economies will not reach pre-pandemic levels of GDP per capita, adding that the recovery process will be uneven because the region-wide estimates mask differences across and within countries.

The report pointed out that each economys performance in the region depends heavily on its exposure to commodity price fluctuations and how well it managed the pandemic.

The pandemics crippling impact on economic activity in the region is a painful reminder that economic development and public health are inextricably linked. It is also a sad reality check that MENAs health systems which were considered relatively developed, cracked at the seams under the crisis, Ferid Belhaj, WBs vice president for MENA, commented.

The report projected the region's GDP per capita to grow by only 1.1% in 2021 after declining by 5.4% in 2020.

By the end of 2021, the regions GDP per capita will still be below the 2019 level by 4.3%, according to the report.

As per the report, 13 out of 16 countries in the region will have lower standards of living in 2021 than their pre-COVID levels.

The last two years have shown that pandemic control is essential not only to save lives but also to accelerate economic recovery, which is now tenuous and uneven across MENA. Stressed health systems and lagging vaccinations in many middle-income and low-income countries in the region are harbingers of downside risks. Roberta Gatti, World Bank chief economist for the Middle East and North Africa region, said.