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Tuesday, 2 October 2018

Egypt current account deficit narrows by 58.6%, BoP nets USD 12.8 bn

Egypt’s current account deficit narrowed by 58.6% y-o-y to USD 6 bn in FY2017-18, down from USD 14.4 bn the previous year, according to a CBE report (pdf). “The improvement reflects the continuous positive impact of the currency liberalization decision,” the CBE said. The balance of payments recorded a surplus of USD 12.8 bn, down from USD 13.7 bn the previous fiscal year, while the trade deficit reached USD 37.3 bn.

The big three: Remittances rose 20.6% to USD 26.3 bn from USD 21.8 bn, pushing net unrequited current transfers up 21.2% to USD 26.5 bn. Tourism receipts recorded a surplus of USD 7.4 bn, up from USD 1.6 bn the previous year; while Suez Canal revenues also grew 15.4% to USD 5.7 bn, compared to USD 4.9 bn in FY2016-17.

Merchandise exports grew 18.9% to USD 25.8 bn, thanks to a 33.1% rise in oil exports to USD 8.8 bn, bolstered by greater volumes and higher global crude prices. Non-oil exports rose 12.7% to USD 17.1 bn, largely thanks to increased exports of electrical appliances, fertilizers, and ethylene and propylene polymers. Meanwhile, imports climbed 6.9% to USD 63.1 bn.

FDI and portfolio investment both retreated: Net FDI inflows dipped to USD 7.7 bn, down from USD 7.9 bn the previous year. New oil sector investments accounted for USD 4.5 bn of total FDI. Portfolio investment generated net inflows of USD 12.1 bn, declining from USD 16 bn, which the CBE “largely ascribed to the decrease in foreigners’ investment in Egyptian TBs.”

The CBE repaid USD 3.9 bn in loans in 2017-18, but received some USD 7.9 bn in disbursements.

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