Breaking News : Egypt slides in World Bank competitiveness rankings

Egypt drops by 11 positions to reach 118th place in this year’s Global Competitiveness Index (GCI)

Ongoing instability since the 25 January Revolution has taken a serious toll on Egypt’s global competitiveness rankings, says a recently issued study by the World Bank.

According to the institution’s recently released Global Competitiveness Report 2013-2014, Egypt slumped from 94 in 2011-2012 report to 118th out of 148 this year. Egyptian institutions were ranked 117th, while the country is ranked 100th in terms of health and primary education and 140th in macroeconomic environment.

The report noted that Egypt’s population is 82.5m, with a GDP totaling $256.7bn and a GDP per capita of $3,112. The Egyptian economy contributes 0.62% of world total.

Market efficiency is ranked 119th while the country occupied the 146th spot in labour market efficiency, 119th in financial market development and the 29th in market size.

The report identified the five most problematic factors for doing business in Egypt as: political instability, government instability, crime and theft, access to financing and corruption.

According to Global Competitiveness Index, the first area of concern is the macroeconomic environment, which has been deteriorating to reach 140th position due to rising budget deficit and inflation. The report said that energy subsidies contribute to the problem and share a significant part of the public expenditure, and structural reforms will be necessary to maintain macroeconomic stability.

The second main area of concern is intensifying domestic competition, which the report said will boost the economy. The third area is to make the labour market more flexible and more efficient.

The current budget deficit stands at 14%, which the government aims to reduce to 9% by the end of this year through these investment projects, as well as the grants received from Gulf countries.

GDP registered a growth rate of 2.2% during the second quarter of the fiscal year 2012-2013, compared to 2.6% during the first quarter of the same fiscal year.