Economic impact of COVID-19 on tourism and remittances: Insights from Egypt
As COVID-19 reaches everywhere, low- and middle-income countries are racing to respond to this massive and fast-moving challenge. In the first country blog post in this series, Clemens Breisinger and colleagues assess the pandemic’s economic impacts for Egypt. Household income, especially for the poor, will be hard-hit, linked to disruptions in tourism and declining remittances. The team provides initial policy insights for support to households and businesses.—John McDermott, series co-editor and Director, CGIAR Research Program on Agriculture for Nutrition and Health (A4NH)
The economic impacts of the COVID-19 crisis are increasingly hitting low- and middle-income countries and the poor. International travel restrictions and the full or partial closure of businesses and industries in Asia, Europe, and North America have led to a collapse in global travel and are expected to reduce the flows of remittances. Tourism and remittances are important sources of employment and incomes for the poor, respectively. This post assesses the potential impacts of the expected reductions in these income flows by using Egypt as a case study.
The pandemic is likely to have a significant economic toll. For each month that the COVID‑19 crisis persists, our simulations using IFPRI’s Social Accounting Matrix (SAM) multiplier model for Egypt suggest national GDP could fall by between 0.7% and 0.8% (EGP 36-41 billion or $2.3-$2.6 billion). Household incomes are likely to fall, particularly among the poor.
This blog post is part of a special series of analyses on the impacts of the COVID-19 pandemic on national and global food and nutrition security, poverty, and development. The blog series is edited by IFPRI director general Johan Swinnen and A4NH director John McDermott. See the full series here.
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