Egypt is well-positioned to sustain its trade ties with the United States despite recent tariff changes, according to Carla Slim, senior economist for the Middle East and Pakistan at Standard Chartered Bank. Speaking during a World Bank conference in Cairo, Slim said the new US tariffs are unlikely to seriously impact Egypt, given the existing trade surplus in Washington’s favor.
Slim emphasized Egypt’s strategic advantage, particularly its control over the Suez Canal, which remains a key global trade route. She noted that canal traffic could increase even amid Red Sea tensions, driven by a boost in South-South trade between emerging economies.
Mohamed Gad, CEO of Standard Chartered Egypt, highlighted that the shifting global tariff landscape presents Egypt with an opportunity to enhance its role as a trade hub for Asian markets, citing its strong infrastructure and competitive operating costs.
During the event, Slim also outlined Standard Chartered’s updated forecasts for Egypt’s currency, predicting the Egyptian pound will weaken to EGP 52 per US dollar in 2025 and EGP 54 in 2026. She attributed this to a range of factors affecting foreign exchange inflows and outflows, including continued support from international lenders like the IMF and World Bank, as well as fresh financing from the European Union under an $8 billion package.
Although risks of capital outflows remain, Slim said prospects for portfolio inflows could help balance the situation, keeping the pound relatively stable. Since early 2025, the pound has fluctuated between EGP 50 and EGP 52 per dollar, with potential canal revenue increases offering a chance for appreciation, she added.
Slim also projected that the Central Bank of Egypt is likely to start cutting interest rates at its 2 May meeting, revising the expected total cut to 2 percent from the previous 1.5 percent forecast.
Inflation is expected to ease to between 10 and 15 percent in 2025, despite recent hikes in fuel prices, Slim said. While monthly inflation could show slight increases, annual inflation is expected to decline.
Regarding economic growth, Slim forecast that Egypt’s real GDP would rebound to 4.5 percent in 2025 and reach 6 percent by 2026. She also expressed confidence in the ongoing improvement of Egypt’s net foreign reserves and the Central Bank’s foreign assets.