Egypt’s economy grew by 5.3% year-on-year in the second quarter (October to December) of fiscal year 2025/2026, matching the pace recorded in the first quarter and marking the country’s strongest performance since the third quarter of FY2021/2022, according to a statement issued by the Ministry of Planning and Economic Development on Wednesday.
Speaking during the weekly cabinet meeting, Planning Minister Ahmed Rostom said Egypt’s annual growth rate is now expected to reach 5.2% by the end of FY2025/2026, which concludes on 30 June 2026. The revised forecast is above the government’s earlier target of 4.5% for the current fiscal year.
The International Monetary Fund (IMF) has also recently raised its projection for Egypt’s real GDP growth in FY2025/2026 to 4.7%, up from 4.5% forecast in October, and expects growth to rise further to 5.4% in FY2026/2027.
Egypt has meanwhile increased its long-term annual GDP growth target to 7.5% by 2030 and aims to cut the debt-to-GDP ratio to 40% or less by the end of the current fiscal year, with the goal of bringing public debt to its lowest level in 50 years.
The country’s positive indicators come as the IMF prepares to consider, on 25 February, the fifth and sixth reviews of Egypt’s economic reform programme under the Extended Fund Facility, along with the first review under the Resilience and Sustainability Arrangement.
Rostom said the non-oil sector was the largest driver of expansion, contributing 1.2 percentage points to overall growth. Industrial activity in the sector rose 9.6%, supported by localisation policies and a 17% increase in non-oil exports, which reached $48.5 billion in 2025, mainly from finished and semi-finished goods.
Egypt aims to increase annual exports to $115.8 billion by 2030, with export councils preparing plans to raise non-oil exports by 15–20% annually through the end of the decade.
The banking sector grew 10.73%, while the insurance sector expanded 12.85%, largely due to wider financial inclusion and expanded services, Rostom said. He added that Egypt’s unemployment rate fell to 6.2% in the second quarter, although companies remained cautious about hiring.
Women’s employment rose to 21.7%, up from 18.5% in the same period of FY2024/2025, supported by economic and labour market reforms. Male employment, however, edged down to 70.8% from 71.3% a year earlier.
Rostom also highlighted employment gains across several sectors, including the Suez Canal (24.2%), restaurants and hotels (14.6%), non-oil industry (9.6%), wholesale and retail trade (7.1%), transport and storage (6.4%), electricity (5.6%), health services (4.6%), and education (3.3%).
He further pointed to growth in the oil and gas sector, driven by increased drilling and exploration that boosted production in recent months, and noted a partial recovery and stabilisation in Suez Canal activity during the second quarter as shipping lines gradually returned after avoiding the route in 2023 amid Israel’s war on Gaza and Houthi attacks on commercial vessels in the Red Sea, which had cut canal revenues by around 40–60% over the past two years.