Bloomberg: Direct foreign investment amounts to $9 billion within the current fiscal year
Beltone: Egyptian exports jump to $52.5 billion in 2017
Bloomberg agency has intensified recently its follow-up for the Egyptian economy’s performance indicators. According to its latest report, the foreign direct investments will jump to above $9 billion within the current fiscal year to reach nearly $13 billion in 2021.
The report focused on a number of axes including the effect of the floatation of the Egyptian pound which encouraged foreign investors to invest in Egypt; as well as, obtaining a loan from the International Monetary Fund (IMF).
A focus is given to the significant challenges facing the country as high inflation rates, which reached unprecedented rates; as well as the tumbling tourism sector, which the government relies on to attract foreign inflows, in addition to exports.
According to the report, Egypt’s foreign direct investment will rise to $9.4 billion within 2016/2017, jumping to about $12.9 billion by 2021, referring that the foreign investment climbed up to $4.3 billion from July to December 2016, compared to $3.1 billion during the same period in 2015.
The report also mentioned that Egypt focused on creating a competitive economic climate to move towards the free market. It adopted some decisions to open the door for foreign investments, as floating the Egyptian pound and applying the open market mechanisms in which supply and demand determines the actual value of commodities, including the currency.
The main reason for the return of the fund managers, following the CBE’s decisions to fluctuate the exchange rates and increase the interest rates, is to invest in the Egyptian market, especially with the government debt instruments, including bonds and treasury bills, added the report
The report drew the attention to the strong progress which the Egyptian exports recorded within the last quarter of 2016, from October to December, witnessed an increase by 18 per cent to record $5.2 billion, amid expectations for further progress from January to June 2017.
Non-oil exports recorded $1.66 billion, increasing by 25 per cent last January, compared to $1.33 billion in January 2016, according to the Ministry of Trade’s statement reported by “Aswat Masrya“. The total exports declined slightly to 1.3 per cent in last December.
A recent report released by Beltone pointed out that Egyptian exports will witness a remarkable growth in the coming years to reach a peak following the exportation of natural gas from ‘Zohr’ field. The report anticipates that Egypt’s exports will increase by $15 billion to jump to about $52.5 billion, higher than last year which recorded a growth rate of 50 per cent, valued at $35.5 billion. Egypt’s exports will amount to $40 billion by the end of 2016/2017 and $47.5 billion during the year 2018/2019.
Egypt exerts great efforts to alleviate the effects of economic decisions on citizens under the severe economic crisis that necessitated such hard decisions. The report noted that the Egyptian government’s efforts related to the economic reform began to bear fruit in many fields with expectations of further improvement within the coming period, added the report.
The report referred that higher tourism revenues will be achieved in the coming period due to lower currency prices, in line with the government’s attempts to meet the requirements of major countries, such as Russia, Germany and UK.
In fact, tourism contributed to the government treasury in 2010 with almost $12 billion after 14 million tourists visited the country.
The return of Russian tourists is approaching after a series of measures have been taken to amend the conditions of airports and meet the security requirements in addition to the return of tourists from other European countries such as Denmark and the Nordic countries.
About inflation, the report referred that the fluctuation of exchange rates at the outset of last November and the devaluation of Egyptian pound by 50 per cent enhanced inflation rates to reach the highest levels since 30 years ago, but all indicators confirm that the current situation is expected especially with the floatation of local currency.
