Will Egypt experience an economic collapse (as defined by any of the listed scenarios) in the next 12 months?
Started
Oct 07, 2024 08:00PM UTC
Closing Jan 01, 2026 05:00AM UTC
Closing Jan 01, 2026 05:00AM UTC
For the purposes of this question, an economic collapse is defined as ANY one of these scenarios occurring:
- Egypt’s main stock market index, the EGX 30, decreases in value by at least 30% over one month.
- Egypt’s annual headline inflation rate reaches 50%.
- Egypt enters into default on its external debts.
Egypt is facing significant economic challenges, including high inflation and currency depreciation. As of August 2024, the annual headline inflation rate rose to 26.2%, following a peak of 38% in September 2023 (Trading Economics). The Egyptian pound has lost about 50% of its value over the past two years, contributing to severe cost-of-living increases. (CNBC).
The EGX 30, Egypt's primary stock market index, has shown volatility, with analysts warning that continued instability could lead to sharp declines. Additionally, Egypt has quadrupled its external debt since 2015, and is equivalent to about 43% of GDP (Reuters). These factors raise concerns about the potential for an economic collapse if significant adverse developments occur.
Resolution Criteria:
This question will be resolved “Yes” if any of the following criteria are met:
- EGX 30 decline of at least 30% over one month: The closing price of the EGX 30 on the last trading day of the month is at least 30% lower than its price on the last closing day of the previous month. More historical data on the EGX 30’s prices is available on Investing.com.
- Egypt’s inflation reaches 50%: Egypt’s annual headline urban inflation rate (“Headline (y/y)”) for any given month is at least 50%, as reported by the Central Bank of Egypt. Historical data is available here.
- Egypt defaults on external debts: Credible financial news sources or international financial institutions (such as the IMF, World Bank, or major credit rating agencies) report that the country’s government has entered a form of sovereign default, such as by missing a payment on external debt obligations and not making the payment within an applicable grace period or by announcing a moratorium on external debt payments. A default will be considered to have occurred at the earliest instance reported by a major financial news source or institution.