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Domestic demand boosts economic growth in late 2024

Thursday 17 April 2025 - 13:32
Domestic demand boosts economic growth in late 2024

During the final quarter of 2024, the national economy posted a 3.6% growth compared to the same period the previous year, according to a recent report by the High Commission for Planning. This performance was primarily fueled by stronger domestic demand.

Though this growth rate was slightly below the 4.2% recorded in the third quarter, it still outpaced the average growth seen in the first half of the year signaling steady economic resilience despite ongoing challenges.

A major driver of this expansion was household consumption, which saw a notable rise due to better income levels and easier access to credit. This contributed 2.6 percentage points to overall growth in the quarter.

Corporate spending on equipment grew at a more tempered pace. However, increased inventory buildup helped boost the total investment’s contribution to growth to 5.4 points, up from 3.7 points in the previous quarter.

Conversely, the trade balance weighed negatively on growth. Despite a 9.2% increase in exports spurred by higher demand for chemical, electronic, and electrical goods imports surged by 15.6%, leading to a 5.2-point negative impact on growth and a decline in the import coverage ratio from the same period in 2023.

While these trends placed some strain on economic financing, the pressures were mitigated by improved net transfers and stronger tax revenues. As a result, the financing gap narrowed, with the deficit dropping to 3.2% of GDP in the fourth quarter, compared to 3.8% in the third.


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