04:58 PM
Sunday, Might 19, 2024
Manal Al-Masry wrote:
The United Nations Growth Program estimated that the full financial price of the battle in Gaza on the Egyptian economic system would attain $20 billion on this fiscal yr and subsequent if geopolitical tensions proceed, assuming that three circumstances rely upon the length of the battle.
A brand new research launched by the United Nations, entitled “Potential Social and Financial Affect of the Gaza Battle on Egypt, linked the three eventualities, specifically “low depth, medium depth, and excessive depth ,” to proceed the battle in Gaza for six months, 9 months, or a yr.
The research predicted that the adverse influence of the battle in Gaza on the Egyptian economic system would proceed till the following fiscal yr 2024-2025 underneath medium and excessive extreme circumstances.
Earlier than the Gaza Battle, Egypt’s economic system was going through nice fragility and elevated social and financial issues after extreme setbacks brought on by the COVID-19 pandemic and the battle in Ukraine.
In line with the research, there are already main macroeconomic challenges, similar to excessive funds deficits and excessive ranges of public debt.
The UN program’s assessment confirmed that the Gaza battle added to those challenges and put extra strain on the nation’s restricted sources.
Egypt’s dependence on risky international revenue, similar to tourism revenue, Suez Canal transit charges, and labor remittances, makes it extremely susceptible to exterior shocks, which in line with what the United Nations mentioned within the research.
Financial price over the following two years
Within the first “low severity” situation, the research advised that the full price to the Egyptian economic system would attain $5.6 billion within the fiscal years 2023-2024 and 2024-2025, and the fiscal yr in Egypt shall be beginning on the primary of July of every yr.
This example assumes that there shall be a slight improve within the battle battle in Gaza for a interval of 6 months.
Within the “medium depth” situation, the research estimated the price of the battle’s influence on the Egyptian economic system at $14.6 billion.
Within the “excessive depth” situation, the associated fee to the Egyptian economic system might attain $19.8 billion, assuming the battle lasts a yr and a large-scale regional navy buildup.
Misplaced GDP
In line with the United Nations research, Egypt’s GDP will endure a lack of various depth, relying on every situation that could possibly be anticipated.
The research estimated a lack of 1.6% of the common annual GDP underneath the low severity situation, whereas the loss reaches 3.9% within the medium severity situation, and rises to five.2% underneath the excessive depth situation.
The extra complete dynamic CGE mannequin reveals adverse impacts much like a 1.6% decline in core GDP in FY 2023-2024 underneath the low-severity situation.
Within the reasonable situation, the loss will improve by 2.6% within the present fiscal yr, and attain 1.3% within the subsequent fiscal yr 2024-2025.
Within the excessive depth situation, the loss will attain 3% of GDP within the fiscal yr 2023-2024 and a pair of.6% within the fiscal yr 2024-2025.
Excessive unemployment price
A decline in GDP progress would additionally imply a probably massive improve in unemployment and decrease family consumption, thus growing the extent of poverty.
The unemployment price is projected to extend by 0.5% underneath the “low deficit” situation, 0.9% underneath the “reasonable deficit” situation, and 1.3% underneath the “extreme deficit” situation in fiscal yr 2023-2024. .
As well as, actual disposable revenue and family consumption will fall under business-as-usual ranges within the present fiscal yr by 1.3% underneath the “low gravity” situation, by 2.1% underneath the “reasonable severity” situation, and with 2.5% underneath the “reasonable severity” situation. “excessive” place.
2024-05-19 13:58:00
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