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The economy grew 4.8% in 3Q FY 2024-2025, more than doubling from the 2.2% recorded during the same period last year, marking its strongest quarterly performance in three years, according to a statement from the Planning and International Cooperation Ministry. Average growth for the first nine months of the fiscal year rose to 4.2% y-o-y, up from 2.4% y-o-y a year earlier.
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Non-oil manufacturing maintained its recovery and continued to record positive growth for the fourth consecutive quarter, growing 16.0% — a sharp rebound from the contraction of around 4% recorded in the same period of the previous fiscal year. The sector was the biggest contributor to GDP growth during the quarter, adding 1.9 percentage points to the country’s overall growth rate. Growth in non-oil manufacturing was supported by significant improvements in industrial export performance, with finished goods exports increasing 12.7% y-o-y during 3Q FY 2024-25.
Other sectors also posted solid growth: Tourism (23.0%), financial intermediation (17.3%), ins. (7.7%), electricity (5.8%), and construction (3.1%) all posted positive growth levels throughout the quarter.
Private investment rose 24.2% y-o-y during the quarter, outpacing public investment for the third consecutive quarter and accounting for 62.8% of total implemented investments (excluding inventory), the ministry said. However, the increase in private investment was not enough to offset the sharp 45.6% y-o-y contraction in public investment at constant prices, which resulted in a negative contribution of investment to GDP growth that reduced the overall growth rate by around 2.4 percentage points.
Weighing on the momentum: Suez Canal activity fell by 23.1% on the back of a decline in vessel traffic due to Red Sea disruptions. Extractive industries also continued to decline as oil output fell by 9.5% y-o-y and natural gas production dropped by 20.5% y-o-y.
The government expects growth for FY 2024-25 to exceed its 4.0% target, citing the rebound in private investment and non-oil manufacturing activity as positive preliminary data.
