Can Egypt’s economic comeback absorb Trump’s global trade shocks?
Buoyed by foreign investment and cautious reforms, Egypt’s fragile recovery faces a new test from Trump’s tariff-fueled trade turbulence.
As markets worldwide grapple with mounting uncertainty amid escalating trade tensions in 2025, Egypt has emerged as a potential bright spot in a region bracing for slower growth as new perils loom amid US President Donald Trump’s global trade reset.
On April 22, the International Monetary Fund (IMF) slashed its 2025 growth forecast for the Middle East and North Africa to 2.6%, down from 3.5%, as headwinds weigh on the outlook for regional oil exporters. But Egypt bucked the trend, with the IMF revising its GDP projection to 3.8%, up slightly from 3.6%, which comes after it grew 2.4% last year.
That upgrade underscores the momentum behind Egypt’s ongoing economic recovery, just over a year after the Arab world’s most populous country narrowly avoided a financial meltdown with the help of an international rescue package totaling nearly $60 billion. The economy has since shown signs of stabilization, bolstered by reforms, foreign investment and renewed investor confidence.
On April 17, the Central Bank of Egypt cut interest rates for the first time since 2020, responding to easing inflationary pressures. Monthly inflation hit multiyear lows early this year, despite a slight uptick in March.
