Egyptian economists and businessmen are finally giving off an air of optimism these days after witnessing a state of instability and skepticism. The report referred back the positive atmosphere to many factors, most notably, the three-year $12 billion loan programme signed with the International Monetary Fund as the largest agreement in the Middle East. The second factor, according to the report, is related to Egypt’s decision to allow its currency to float freely in a bid to end a crippling crisis of foreign currency reserve. Many indications prove that the Egyptian economy is on the right track, according to the evaluation of Bloomberg’s journalist John Sfakianakis. Egyptian Pound’s appreciation has been faster than expected. Also the Central Bank of Egypt revealed that the successful sale of Eurobonds has encouraged carry-trade investors, who have invested more than $2 billion since the float. It is remarkable that stock market in Egypt has improved to be one of the best performers in the emerging markets and the best in Africa. “Egypt has battled to resuscitate its economy since the 2011 uprising that ended Hosni Mubarak’s three-decade rule and his Islamist successor two years later,” wrote Sfakianakis viewing that the reforms will help attract further foreign investment, that in return creates jobs and reverses declining living standards. The report warned that the foreign investments are not enough to boost growth rates mounting to 3.5 per cent, exceeding the growth rates of Gulf economies, but not enough to address unemployment.
«Exports should get a boost given the cheaper currency, but perhaps more importantly tourism should be a beneficiary of a more affordable currency, the report pointed. It explains that Tourist arrivals plunged 38 percent to 558,000 in November 2016 from a year earlier. Remittances from Egyptians working abroad rose 11.1 percent to $4.6 billion in the fourth quarter of 2016, and have become one of the most important sources of foreign-exchange inflows. Furthermore, the report expects that the reforms will also help the auto industry in particular. Automotive industry has become one of the largest in Africa, producing more than 100,000 vehicles a year and employing 75,000 workers. The good news is that Egypt’s large consumer market and strong logistical network ties to Asia, Europe and Africa makes a good manufacturing destination.
