GDP growth was up 0.8 percentage points y-o-y in 1Q FY 2024-2025, coming in at 3.5% y-o-y for the three month period, according to a statement from the Planning and International Cooperation Ministry. The figures mark a recovery from the slowdown in 1Q FY 2023-2024, which had declined sharply from the 4.4% a year earlier amid global economic headwinds and domestic challenges.

Non-oil manufacturing picks up steam with customs relief: Customs clearance facilitation for production inputs has helped drive a resurgence in non-oil manufacturing, which expanded 7.1% y-o-y in 1Q, marking its second consecutive quarter of growth. Government data suggests industrial output rose 6%, recovering from last year’s 7.7% contraction, with export-led sectors like chemicals, fertilizers, and ready-made garments leading the way.

Improvements were seen across the board: Transport and storage (+15.6%), ICT (+12.2%), tourism (+8.2%), electricity (+7.4%), social services including health and education (+4.5%), and agriculture (+2.7%) all posted growth.

But Suez Canal revenues plunged and energy output stumbled: Suez Canal revenues plunged 68.4% y-o-y in 1Q as geopolitical tensions slashed transit volumes, delivering a sharp blow to one of Egypt’s main revenue streams. The energy sector also struggled, with extraction activity contracting 8.9% y-o-y amid sluggish oil and gas production.

Private spending up, public investment down: Private investments rose 30% y-o-y in 1Q to EGP 133.1 bn, up from EGP 102.3 bn last year, driven by stricter governance on public spending. Public investments, meanwhile, contracted 60.5%, falling to EGP 57 bn from EGP 144.4 bn in 1Q FY 2023/24.

The bigger picture: The Planning Ministry projects GDP growth of 4.0% for FY 2024-2025, supported by private sector reforms and gradual economic recovery.

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