Almost three years after the outbreak of the Arab Spring uprisings, Egypt’s economic performance is yet to recover. Amid the ongoing political uncertainty and social instability, Egypt’s macroeconomic indicators remain well below the level before 2011.
Economic growth remains weak, coupled with high budget deficit and high public debt. Low growth rates pose a danger to poverty eradication efforts and contribute to mounting social frustrations, as they will not suffice to deliver the needed jobs and opportunities. Poverty remains high, especially in Upper Egypt: with 41.2% population living on less than USD1 per day during 2010 and 2011, Upper Egypt doubled the national average of 21%.
The year 2013 saw the highest record of unemployment, which peaked to 13.4% of the total workforce. This is much higher than the Egyptian average unemployment rate of 9.9% over the last decade. Most critically, one out of three young people are not absorbed by the labor market.
The ongoing political uncertainty and social instability have accelerated inflation rates due to the higher prices of imports, and hit tourism and foreign direct investment (FDI), which are the two key sources of foreign reserves.
The imperative of supporting broader economic and social growth within an environmentally sustainable framework, where prosperity is shared among all parts of society and no one is left behind in benefiting from industrial growth, has become even more urgent in the aftermath of the Arab Spring uprisings. Indeed, industry generates the wealth needed to address critical economic, social and humanitarian needs in Egypt.