2025 in Review (Egypt) | INVESTMENT SIGNALS IN A STABILIZING ECONOMY
Egypt’s economic performance in the third quarter of fiscal year 2024/25 marked a turning point, recording real GDP growth of 4.77% year-on-year, the highest in three years. The momentum carried into Q4, with the economy growing by around 5%, pushing the full-year growth for FY 2024/25 to ~4.4%, up markedly from ~2.4% in FY 2023/24. The rebound reflects expanding activity across different sectors, signaling that earlier macroeconomic shocks are gradually dissipating. Additionally, performance benefited from the partial recovery of Suez Canal revenues following the slowdown in Houthi-related disruptions, as well as Egypt’s stabilizing regional role, particularly its mediation efforts around the Gaza ceasefire, which helped reinforce perceptions of regional stability and supported confidence in Egypt’s economic and geopolitical positioning.
At the same time, renewed FDI is helping to stabilize foreign-exchange liquidity, a major positive after the currency volatility of 2023–2024. Inflation has markedly cooled compared with 2023’s peak: urban consumer-price inflation stood around 12.5% in October 2025, down substantially from the extreme highs of recent years. The improved inflation outlook, combined with structural reforms and improving external balances, has helped restore macroeconomic credibility, which in turn supports private-sector investment appetite and some recovery in business confidence.
1. MANUFACTURING
Egypt’s manufacturing sector in FY 2024/25 shifted from contraction to a clear recovery and became one of the main engines of GDP growth. Real GDP grew by 4.77% in FY 2024/25, up from 2.4% the previous year, with the Ministry of Finance explicitly highlighting manufacturing as a key driver. Within this, non-oil manufacturing recorded strong and broad-based momentum: it grew by 7.1% in Q1, 17.7% in Q2, 16% in Q3, and 18.8% in Q4 of FY 2024/25, bringing full-year growth to about 14.7% versus a 5.2% contraction in FY 2023/24. During Q3 FY 2024/25, non-oil manufacturing was the largest single contributor to growth, adding around 1.9 percentage points to the 4.77% quarterly GDP expansion.
At the activity level, the transformative and extractive industries index (a proxy for industrial production) continued to strengthen, with the index rising to 120.47 in March 2025 from 115.93 in February, indicating solid output growth in manufacturing and related industries. Industrial exports (semi-manufactured and finished products) increased by 73.8% to USD 32.5 billion in FY 2023/24, up from USD 18.7 billion in FY 2013/14, underscoring the sector’s growing export orientation entering 2025.