Egypt: economic effects of COVID-19

Abstract

By the beginning of 2020s Egypt completed the first phase of large scale program of economic reforms launched in 2016, that began to bring positive results. The article discusses improvement of macroeconomic indicators, signs of stabilization of the financial system and increased participation of the private sector in the country’s economic growth, as well as shifts in the key sectors of the domestic economy. However, Egypt’s gradual stabilization and acceleration of economic growth was affected adversely in early 2020 by the rapid spread of the global COVID-19 pandemic. The author analyzes the negative consequences of coronavirus on the major sources of government revenues and foreign currencies (tourism, money transfers of Egyptian migrant workers, income from the Suez Canal), which are primarily impacted by global economic downturn, international restrictions on internal and cross-border movement of people and goods. Besides, particular attention is given to various scenarios of the COVID-19 effects for the economy and population of Egypt in the foreseeable future. Furthermore, the article explores measures that the government took to minimize the socio-economic consequences of the pandemic.