The crash is the third airline incident in less than a year involving the Arab world's most populous nation, undermining efforts to attract tourists and their much-needed revenues.
Officials said it was too early to know whether technical failure or terrorism caused the EgyptAir plane to plunge into the Mediterranean on Thursday with 66 people on board during a flight from Paris to Cairo.
But it follows the bombing of a Russian passenger plane minutes after it departed from an Egyptian Red Sea resort in October, an attack claimed by the Islamic State (IS) group.
Whatever the cause of the latest crash, it is certain to have an impact on Egypt's economic recovery, analysts said.
"Egypt's return to international news headlines in the context of a plane crash at its national carrier, no doubt this is very harmful," said Amr Adly, an economist with the Carnegie Middle East Centre in Cairo.
"This will prolong the stumbling of the tourism sector," he said.
The key industry has been hit by a series of disasters.
A 2011 uprising that unseated strongman Hosni Mubarak triggered years of political turmoil that kept many foreign visitors away.
The military overthrew his successor Mohamed Morsi in 2013 and launched a bloody crackdown on the Islamist's supporters.
Since then Islamist insurgents have killed hundreds in attacks, mostly members of the security forces but also tourists including those aboard the Russian airliner which IS said it had downed with a bomb hidden in a soda can smuggled into the hold.
The security forces themselves have also killed tourists by mistake.
Eight Mexican tourists died in an air strike in September 2015 after they were mistaken for militants while picnicking in the desert.
And in March, an Egyptian man who wanted to see his ex-wife hijacked an EgyptAir flight and forced it to divert to Cyprus.
No one was harmed and the man surrendered to police -- after allowing hostages to take selfies with him.
- 'Recovery postponed' -"All this is adding to the negative sentiment towards Egypt's tourism sector," said Hany Farahat, senior economist at CI Capital in Cairo.
"And definitely, it postpones any potential for recovery in 2016 as far as tourism revenues are concerned," he said.
Tourism revenues slumped 15 percent in 2015 and Egypt's foreign currency reserves are under intense pressure, falling to $17 billion in April from more than $36 billion in 2010.
The recent incidents have dashed hopes of a recovery in the sector, which had seen signs of improvement.
"Arrivals from key markets plummeted in 2011 and started gradually to recover until 2015. But those never achieved the performance from prior to the events," said Kinda Chebib, senior analyst at Euromonitor International.
"We believe that the recent events will slow down the ambitions of the local government to achieve the target of 20 million foreign tourist arrivals by 2020," she said in an emailed statement.
The repercussions will be felt by Egyptian President Abdel Fattah al-Sisi, the former army chief who toppled Morsi then won presidential elections.
Sisi enjoyed widespread popularity after toppling Morsi, despite the crackdown on Islamists that left hundreds of protesters dead and thousands in jail.
But dissent has been growing as the crackdown extends to secular and liberal activists, while the much-vaunted economic recovery stalls.
"This incident might contribute to discrediting the legitimacy of President Abdel Fattah al-Sisi's rule, because he had promised to fight terrorism and restore security, and terrorism is still affecting the Egyptian economy and threatening Egyptian people's income," said Mustapha Kamel, a political science professor at Cairo University.