CAIRO: Egypt’s gross domestic product (GDP) accelerated to an annualized 5.9 percent in the three months to end-June, indicating the country had rebounded from the global downturn, a cabinet statement said on Wednesday.
Growth for the entire financial year to end-June rose to 5.3 percent from 4.7 percent in 2008/09, the statement said. The economy grew by 5.9 percent in the fourth quarter of 2009/10, up from 5.8 percent in the third quarter and 5.1 percent in the second quarter.
"If we are to see any indication from the growth rate, the second quarter is higher than the first, and the third is higher than the second. Then clearly we are getting back to normal," Osman said at a news conference.
"This indicates a near full recovery from the global crisis and a return to the path of rapid economic growth similar to the period before the global crisis," the Cabinet statement quoted Economic Development Minister Osman Mohamed Osman as saying.
He added that Egypt’s gross domestic product (GDP) is likely to grow by at least 6.5 percent in the financial year that began on July 1 and that the economy will grow to 6.5 pct in 2010/11, if not more.
Economists said the fourth quarter growth figure was better than they had expected.
"It was a good performance," said Simon Williams, an economist for HSBC. "It means growth has accelerated almost every quarter since end-2008.
Egyptian growth rose to a record 7.2 percent in 2007/08 before the global downturn curbed tourism, foreign direct investment and Suez Canal revenues in the Arab world’s most populous country.
The construction sector grew by an annual 13.2 percent in the fourth quarter and the information technology sector by 12 percent, the cabinet said.
"We know that tourism did well in the quarter," said Simon Kitchen, an economist with EFG-Hermes. "We assume that investment did as well. That has been reflected in the recovery of credit growth that we’ve seen in the quarter."
Tourism is a vital source of foreign currency in Egypt, along with Suez Canal revenue, oil and gas exports and remittances from Egyptians living abroad.
Government officials have forecast that in the fiscal year that began on July 1 the economy could grow by 5.8 to 6.0 percent.