EBRD Sees Egypt Growing 4.6 Percent in 2026 and Raises Its 2027 Forecast to 5.0 Percent
The European Bank for Reconstruction and Development expects Egypt’s economy to grow 4.6 percent this year and raised its 2027 forecast for Egypt to 5.0 percent from 4.9 percent, in its Regional Economic Prospects published on 24 September. The bank lowered its 2026 forecasts for Jordan, Lebanon and Iraq. It cut Iraq’s deepest: from a 1.5 percent contraction to a 12.0 percent contraction.
| Economy | 2026 forecast | Revision since June | 2027 forecast |
|---|---|---|---|
| Egypt | 4.6% | -0.3 | 5.0% |
| Jordan | 2.5% | -0.1 | 2.8% |
| Lebanon | -5.0% | -3.0 | 4.0% |
| Iraq | -12.0% | -10.5 | 14.0% |
| Southern and eastern Mediterranean | -0.7% | -3.2 | 7.1% |
| All EBRD economies | 2.5% | -0.6 | 4.0% |
EBRD, Regional Economic Prospects, September 2026, Table 1. Revisions are in percentage points against the June 2026 forecasts; June figures in the text are our calculation from them. Egypt is on a calendar year basis.
Egypt: growth backed by communications, trade and refining
The bank says growth is supported by communications, trade and petroleum refining, and that remittances and tourism receipts rose strongly in the first quarter. It notes that Egypt completed the seventh review of its IMF programme in July and that reserves are at a record. The bank estimates first-half growth at 5.0 percent, after growth of 5.1 percent in 2025. The 2026 figure is 0.3 point below the bank’s June forecast of 4.9 percent, on our calculation. On our calculation, the forecasts for 2026 and 2027 would leave the economy about 9.8 percent larger in 2027 than in 2025.
On the fiscal side, the bank puts gross government financing needs at around 50 percent of GDP for fiscal year 2027, and interest payments at more than 30 percent of government revenue in Egypt and Kenya.
Jordan: a small cut on regional instability and trade interruptions
Jordan’s forecast slips to 2.5 percent from 2.6 percent. The bank cites regional instability, trade interruptions and uncertainty around tourism and investment flows. That compares with 2.8 percent growth in 2025. Higher fuel prices pushed inflation to a peak of 2.8 percent in May before it eased to 2.7 percent in July. The bank says reserves cover more than eight months of imports. Its 2.8 percent forecast for 2027 assumes that trade bottlenecks are resolved and energy prices decline.
Lebanon and Iraq: the two deepest cuts
Lebanon is now expected to contract 5.0 percent this year after renewed hostilities in the first half, against a 2.0 percent contraction forecast in June and growth of 3.5 percent in 2025. The bank says inflation doubled to around 20 percent in April and was 15.7 percent in July. Further damage has added to an 11 billion dollar reconstruction bill from previous rounds of conflict. Its 4.0 percent rebound for 2027 depends on a sustained ceasefire. Even then, on our calculation, output in 2027 would still be about 1.2 percent below its 2025 level.
Iraq’s 12.0 percent contraction reflects severe disruption to oil exports through the Strait of Hormuz. The bank says alternative routes have carried less than a quarter of normal export volumes. Its 14.0 percent rebound in 2027 assumes that oil exports normalise. On our calculation, that would return output only about 0.3 percent above its 2025 level. Iraq drives most of the bank’s downgrade: excluding Iraq, its 2026 cut across all EBRD economies is 0.1 point rather than 0.6, and southern and eastern Mediterranean growth would be 3.9 percent this year and 4.3 percent next.
Why it matters: For Egypt, the bank’s forecasts point to growth of 4.6 percent this year strengthening to 5.0 percent in 2027, alongside record reserves, remittances and tourism receipts that rose strongly in the first quarter, and a completed seventh IMF review. On our reading, that growth path is what supports Egypt’s financing position. Jordan’s reserve cover, above eight months of imports, provides an external buffer.
Outlook: The bank’s 2027 rebounds for Lebanon and Iraq rest on conditions it states openly: a sustained ceasefire and the normalisation of oil exports.
Sources: European Bank for Reconstruction and Development.
