The International Monetary Fund recently updated its growth projections for the Middle East and North Africa (MENA) for 2025, indicating a slight improvement in economic outlook amid ongoing geopolitical uncertainties.
The IMF has increased its forecast for MENA’s GDP growth to 3.3 percent, an increase from the previous estimate of 2.6 percent made in May.
“The current outlook demonstrates resilience in a context marked by heightened global uncertainty, with trade tariffs impacting many nations and lingering geopolitical tensions,” stated Jihad Azour, director of the IMF’s Middle East and Central Asia department, in remarks to Reuters.
Regional oil exporters are reaping benefits from rising oil production alongside bolstered public investment and efforts towards economic diversification through structural reforms.
On the other hand, oil-importing countries have seen improved growth due to falling commodity prices, a resurgence in tourism, and increased remittances, alongside better access to financial markets and easing inflation.
“Nevertheless, these advancements are occurring in a climate of significant uncertainty, with risks skewed to the downside,” Azour noted in Dubai prior to the release of the IMF’s Regional Economic Outlook report.
Potential risks include a decline in oil prices if global demand weakens, intensifying trade tensions globally—though MENA has experienced less impact than other regions—and persistent high inflation worldwide.
“Recent geopolitical tensions have shown signs of lessening, but vigilance remains necessary.”
Egypt’s GDP Forecast Boosted by Tourism and Remittances
The growth forecast for Egypt has been adjusted upward to 4.3 percent for 2025, up from the previously projected 3.8 percent, supported by rising tourism revenues and strong remittances from Egyptians living abroad. Inflation has also decreased significantly from nearly 40 percent in 2023 to 11.7 percent as of September, aided by the IMF’s $8 billion loan program launched in March 2024.
“We encourage the government to expedite the execution of two key objectives: divestment and enhancing transparency regarding specific state-owned enterprises,” Azour remarked.
Ongoing discussions between the IMF and Egypt concerning the combined fifth and sixth reviews of its loan program are expected to conclude in the fourth quarter.
Since 2020, the IMF has approved a total of $55.7 billion in financial assistance for regional countries, with $21.4 billion sanctioned since early 2024 for programs in Egypt, Jordan, Morocco, and Pakistan.