Remittances from Egyptians abroad posted a record high of USD 36.5 bn in FY 2024-2025, climbing 66.2% y-o-y, according to a statement from the Central Bank of Egypt. Remittances jumped 34.2% y-o-y during the last quarter of the fiscal year to hit USD 10.0 bn.

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Higher than expectations: Remittances’ uptick throughout FY 2024-2025 was much higher than Morgan Stanley’s forecast of USD 32 bn. The figure also surpassed the peak of USD 31.4 bn recorded in FY 2020-2021 pre-FX crisis. In contrast, FY 2023-2024 saw remittances come in at only USD 22.1 bn, as remittances were flowing through unofficial channels. .

REMEMBER- Remittance inflows began returning to official channels after the float of the EGP back in March 2024, which effectively put an end to the parallel market that had pushed remittance flows to unofficial channels.

On a monthly basis, remittances hit the highest figure ever recorded for June, with a 40.7% y-o-y increase to USD 3.6 bn, marking 16 consecutive months of y-o-y remittance growth.

Driving the growth: “The significant increase in remittances during the past fiscal year is partly attributed to a favorable base effect, as 2024 witnessed an exceptional dip in remittances due to the unstable exchange market and the wide gap between the official and parallel rates, which led many to transfer their money through unofficial channels,” Professor of Economics Medhat Nafei told us.

Also helping: The improved working conditions for Egyptians in the Gulf, along with the continuation of major investment projects, and the rise in USD or SAR incomes, also contributed to the increased ability to remit money, Nafei added. The GCC is our biggest source of remittances, with most of the estimated 14 mn Egyptians working abroad based in the Gulf. Leading the pack as the main source of incoming FX is Saudi Arabia with 2.5 mn Egyptians there, followed by the UAE and Kuwait with around 600k each.

That's not all: “It’s natural to see this rebound following the float. Egypt’s assets became materially cheaper compared to the rest of the world, which triggered sizable inflows, including into real estate,” Ahly Pharos Head of Research Hany Genena told EnterpriseAM.

As for external factors, the Iran-Israel conflict played an indirect role in boosting remittances, as the war caused oil prices to rise intermittently during the first half of the year, which had a positive impact on the Gulf economies that house most of the Egyptian workforce. Higher oil prices led to increased government spending and development projects, and, consequently, higher incomes for workers, Nafei explained.

Remittances have become an economic safety valve that balances external pressures with the state's need for sustainable and stable FX resources, as it helps the state to fill in the gap and cover our rising costs of energy and fuel imports, Nafei concluded.

Our GDP is heavily influenced by remittances volume: Money sent from abroad is expected to have made up around 8% of the country’s entire GDP in 2024, up from 5% in 2023 and 6.1% in 2022. In terms of current account inflows, remittances from Egyptian expats are expected to have accounted for 35% of inflows in 2024, up from the 25% recorded the year prior, but still a long way off from the 45% recorded in 2020.

Remittances have reached “a seven-year high of 9.3% of GDP” in the four quarters leading to the 1Q 2025, according to a recent Capital Economics note seen by EnterpriseAM. This increase is partly a result of improved FX conditions, which have boosted confidence among Egyptians abroad.

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