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Tuesday, 22 June 2021

Slow vaccine rollout could dent our tourism recovery

Egypt’s slow vaccine rollout could see it lose out on a second summer tourist season, with travel restrictions from the likes of the US, UK, and EU likely to stay with us until the start of 2022, Capital Economics said in its MENA Economics Update (pdf). Egypt’s vaccine rollout continues to be outpaced by regional leaders including much of the GCC and Morocco, though the local production of China’s Sinovac jabs is expected to speed up the process — as well as allow Egypt to export doses to Africa in the coming months — the report said.

A“sluggish” rollout is likely to keep foreign visitors at bay: Egypt was recently added to the UK’s red list, making the cost of travel to Egypt prohibitive for British Red Sea holiday makers as they’ll be required to quarantine at their own expense for 10 days upon returning home. This is likely to discourage many UK nationals from visiting what has traditionally been one of their favorite summer holiday destinations. Saudi Arabia’s Public Health Authority has also this week classified Egypt as a “very high risk” travel destination and advised visitors against travel to Egypt, a development which we recap in What We’re Tracking Tonight, above.

Still, the government insists a tourism recovery is in the cards: Egypt has seen 2 mn people visit the country in 5M2021. This is only 40% of the tourist numbers we were getting before the pandemic devastated the sector, but has given the government reason to revise upward its tourism revenue targets for the year to between USD 6-9 bn.

To put things into perspective: Some 4 mn Egyptian residents have received at least one dose of a covid-19 vaccine, which equals roughly 7% of folks eligible for a jab, which includes citizens and other residents aged 18 and over, according to statements by a senior health official this week. It’s a significant improvement from the 2.5 mn people that had received a dose at the start of the month. The government is aiming to vaccinate at least 20% of all citizens before August, with an eye to having covered 40% of the population by the end of the year.

Other countries in the region have fared better: Vaccine superstar the UAE has administered at least 14.5 mn doses to its 9.8 mn-strong population. Assuming every resident requires two doses, this means the Emiratis are well in the lead with over 74% of its folks covid-protected. Other GCC countries have also vaccinated large swathes of their population, with Qatar and Bahrain administering doses to over 50% of its residents and Saudi Arabia some 24%. Outside the GCC, Morocco is also doing well with nearly a quarter of its population already jabbed.

Other highlights from Capital Economics: MENA GDP is expected to grow by 2.8% in 2021, down from 4.3% in 2020, but the recovery is likely to be uneven, with the GCC and Morocco taking the lead and Oman and the non-GCC countries lagging behind.

CATCH UP QUICK-

  • SCA renews fee discounts for tankers: The Suez Canal Authority has extended price breaks on container ships and bulk carriers travelling between the Americas and Southeast Asia to average 15-75% until end of this year, local press reports, in a move that aims to draw in more traffic.
  • To liquidate or not to liquidate Egyption Iron and Steel? An unnamed Ukranian company has submitted a technical and financial offer to develop and manage Egyptian Iron and Steel — currently undergoing liquidation — through a revenue sharing mechanism, according to a statement (pdf) that did not disclose further details. State-owned Metallurgical Industries Holding is currently reviewing the offer. Don’t hold your breath.

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