Back to the complete issue
Thursday, 8 November 2018

Egypt is the fourth most vulnerable to the EM Zombie Apocalypse

Egypt is one of the countries most vulnerable should the EM Zombie Apocalypse bite again,according to study by Bloomberg Economics. Turkey was the most vulnerable, followed by Argentina and South Africa. Thailand and Saudi Arabia are the least vulnerable of the 20 nations included in the study.

What’s the methodology? Bloomberg Economics cobbled together a ‘vulnerability index’ that takes into account the current account balance and short-term external debt (both as a percentage of GDP), reserve coverage, government effectiveness and CPI inflation. Data is primarily from the World Bank and IMF as well as from the national stats agencies of each of the 20 countries.

The bad news for Egypt: We were given the lowest score for government effectiveness in our peer group, suggesting we have a “less-than-optimal” ability to deal with long-term external shocks. Foreign currency reserves, although now adequate after being rebuilt by the central bank, are also fairly low in comparison to the peer group.

The good news for Omm El Donia: Our short-term external debt position is the strongest among the 20 economies in the group: Egypt’s ratio of short-term external debt, by residual maturity, to GDP stands at 5.0% so far into the year. Another good sign is that, although inflation has overshot the central bank’s target in the third quarter, the miss was likely transient and we’re doing far better on that front than Turkey and Argentina.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.