IN SHORT: Egypt’s net foreign direct investment inflows reached $9.3 billion in the first half of fiscal year 2025/26 (July 2025 to December 2025), up 55% from $6 billion in the same period a year earlier. The economy grew 5.3% over the same six months, driven by industry, agriculture, information technology and tourism. Remittances from Egyptians abroad rose 29.6% to $22.1 billion. The IMF has disbursed $2.3 billion under the combined fifth and sixth reviews of Egypt’s Extended Fund Facility.
Egypt’s economic reform programme is delivering results at scale: FDI up 55% to $9.3 billion in six months, economic growth at 5.3%, remittances at a record $22.1 billion, and a primary fiscal surplus of 3.5% of GDP, all achieved in the first half of the current fiscal year as the country navigates the competing pressures of IMF programme compliance and the economic shock from the Hormuz conflict. Finance Minister Ahmed Kouchouk presented the figures to international investors at a roundtable hosted by Jefferies International and Société Générale on the sidelines of the IMF and World Bank Spring Meetings in Washington on April 15.
- FDI inflows of $9.3 billion in the July to December 2025 period represent the strongest first-half performance since the UAE-backed Ras El Hekma mega-deal in 2023/24. The composition is more diversified than the Ras El Hekma year: Gulf investments across energy, ports, logistics and real estate continue, while European and Asian capital is returning to Egyptian manufacturing, pharmaceuticals and digital services.
- Real GDP growth of 5.3% in H1 FY2025/26 was led by industry, agriculture, IT and tourism. Tax revenues rose 29% over the nine-month period July 2025 to March 2026, reflecting improving business confidence and stronger private sector activity. The overall budget deficit narrowed to 5.2% of GDP for the same period, down from 6% a year earlier.
- Remittances from Egyptians living abroad reached $22.1 billion in H1 FY2025/26, a 29.6% increase year on year. Egypt’s diaspora remittances are structurally important: they are the country’s largest single source of foreign currency, exceeding Suez Canal revenues and tourism receipts in most periods, and their recent surge partly reflects improved official exchange rate conditions following the 2024 currency float.
- Egypt’s gross foreign reserves stood at approximately $59.2 billion as of December 2025, up from $54.9 billion in December 2024, providing more than six months of import cover. The IMF’s February 2026 disbursement of $2.3 billion under the fifth and sixth EFF reviews confirmed that Egypt’s macro stabilisation is on track.
- The IMF has cautioned that progress on structural reforms remains uneven, particularly on reducing the state’s economic footprint and levelling the playing field between state-owned enterprises and private companies. Egypt’s privatisation programme, which generated nearly $6 billion through 14 partial divestments, has slowed from its 2023 pace. The government plans to raise approximately $6 billion more through asset sales by October 2026.
- Egypt’s exposure to the Hormuz shock is mixed. As a gas importer with a significant LNG import bill, higher energy prices are a fiscal negative. But as a country exporting through the Suez Canal, the rerouting of global shipping around Africa has reduced canal transit revenues, which were already under pressure from Red Sea security concerns. The net impact is broadly negative on the current account but manageable given the FDI and remittance cushion.
Egypt’s economic story in 2026 is a genuine reform recovery, not merely a UAE-funded one-off. The 5.3% growth rate, the tax revenue surge, the FDI diversification and the remittance boom all reflect structural improvements in the operating environment for private business. The risks are real: the Hormuz shock, a heavy debt service burden, persistent inflation above the central bank’s medium-term target, and the political difficulty of privatising military-owned enterprises. But the macro trajectory is positive in a way that was not obvious two years ago when the country was effectively insolvent.
The Bigger Picture: Egypt is Africa’s second-largest economy with 110 million people. A sustained 5% plus growth rate with rising FDI, falling inflation and a primary fiscal surplus is a fundamental change in the country’s investment profile. At $59 billion in reserves, the country is no longer vulnerable to the kind of currency crisis that has periodically derailed Egyptian growth cycles. The IFC is investing $1.2 billion in Egypt in FY2025/26 alone. Gulf sovereign wealth funds have multi-year deployment pipelines. If the privatisation programme accelerates and private sector-led growth takes over from public investment, Egypt has a credible path to becoming one of Africa’s premier FDI destinations this decade.
Source: Financial Afrik, April 24 2026 / Ecofin Agency, April 17 2026
