Egyptian billionaire Naguib Sawiris has called for a reassessment of the country’s large-scale development projects, highlighting their heavy reliance on foreign currency and the financial burden they place on the economy.
“I will be polite and I would say we have an overambitious president who is doing mega projects that are requiring a lot of foreign currency and we should have a second look at these projects.”
Naguib Sawiris
Since President Abdel Fattah al-Sisi took office in 2014, Egypt has undertaken an extensive infrastructure expansion. Among the most ambitious projects is a $58 billion new administrative capital, which Sisi argues is essential for economic growth and accommodating the nation’s rapidly expanding population of 105 million.
The government plans to invest billions more in the development, making it the largest of several high-profile initiatives championed by Sisi. Designed as a high-tech, modern metropolis, the new capital aims to ease congestion in Cairo. However, critics argue that such projects divert critical resources and contribute to Egypt’s mounting debt crisis.
In addition to domestic financial challenges, Egypt is witnessing a concerning trend of businesses relocating abroad. Last year alone, 1,500 Egyptian companies moved their headquarters to Abu Dhabi, according to Sawiris.
He also urged for the unification of UAE stock exchanges to encourage firms to list in the region and improve liquidity. The UAE currently operates three stock exchanges: the Abu Dhabi Securities Exchange, Dubai Financial Market, and Nasdaq Dubai.
Egypt’s economy enters 2025 at a pivotal moment, with cautious optimism about growth projections tempered by persistent inflation and structural reform challenges. The country’s GDP is expected to expand by 4% this year, surpassing the global forecast of 3.2%. This growth is driven by a resurgence in tourism, strategic public investments, and gradual monetary policy adjustments. However, inflation remains elevated at 22.6% (core) as of January 2025, posing a challenge in stabilizing prices while fostering economic recovery.
Tourism and Investment as Growth Drivers
Tourism has emerged as a vital economic engine, contributing a record EGP 953 billion ($31 billion) to GDP in 2024, with international visitor spending surging 38.5% year-on-year. The sector supports over 2.5 million jobs, though employment levels remain below pre-pandemic peaks.
Meanwhile, the government is channeling EGP 1 trillion ($32.5 billion) into public investments for 2024/2025, prioritizing infrastructure and human development. Strategic industries like textiles and energy are also gaining traction, with exports projected to triple by 2030.
The Central Bank of Egypt (CBE) has maintained interest rates at 27.25% since December 2024, following a cumulative 1,900-basis-point hike since 2022. While inflation has eased from its peak of 38% in late 2023, food and energy price volatility persists.
Analysts predict potential rate cuts as early as April 2025, depending on sustained disinflation toward the International Monetary Fund’s (IMF) 16% CPI forecast by mid-year.
Egypt continues to grapple with currency pressures and external debt challenges, exacerbated by geopolitical tensions and Red Sea trade disruptions. Structural reforms, including subsidy reductions and privatization, are supported by $50 billion in international financial assistance pledged in 2023.
The energy sector remains a focal point for foreign direct investment (FDI), with a shift toward renewable energy projects aimed at enhancing sustainability and reducing costs.
At the EGYPES 2025 conference, Finance Minister Ahmed Kouchouk underscored the government’s commitment to economic stability, stating, “Stability of financial and economic performance paves the way for increasing production and exports.”
With GDP growth projected to accelerate to 4.7% in 2025/2026, Egypt faces a crucial test in balancing macroeconomic stability with inclusive growth. The country’s ability to navigate these economic crosscurrents will determine its long-term trajectory as a regional powerhouse.
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