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Egypt’s growth rate continues upturn for 5th quarter in row: EBRD

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CAIRO – 13 November 2018: The European Bank for Reconstruction and Development (EBRD) reviewed the Egyptian economy in its latest report “Transition Report 2018/2019”, stating that growth continued to accelerate for the fifth consecutive quarter.

“It reached 5.3 percent year-on-year in the second quarter of fiscal year 2017/18, and an estimated 5.3 percent for the year, the highest rate in a decade,” the report said.

The report attributed the hike to manufacturing, trade, tourism and construction, in addition to the recovery in mining.

“In per capita US dollar terms, GDP shrank in fiscal year 2016-17, as a result of the currency depreciation and sustained population growth, and increased by 5.0 percent in fiscal year 2017-18,” the report read.

EBRD

Regarding Unemployment, the report said that the rate dropped for the seventh consecutive quarter but remained elevated at 9.9 percent in the second quarter of 2018, and higher among the youth (24.8 percent) and women (21.2 percent).

The report clarified that the continued moderation in the unemployment rate is mainly due to the bold reforms implemented in late 2016 and throughout 2017, which have boosted export-oriented businesses and improved the economic outlook.

“The government has also launched large construction projects that have generated many jobs,” the report stated.

The report also outlined inflation, noting that it declined from its record high level of 33.0 percent in July 2017 to 16.0 percent in September 2018.

“Meanwhile, in January 2018, the real interest rate turned positive for the first time in almost two years, and continued to increase, supported by the decline in inflation, despite the easing of monetary policy which started in February 2018,” according to the report.

EBRD said in its report that the fiscal and external positions have improved, stressing that the government achieved its first primary budget surplus in 15 years of 0.2 percent of GDP in fiscal year 2017-18, and the overall fiscal deficit narrowed to 9.8 percent of GDP (slightly below the target of 9.0 percent) from 10.9 percent in fiscal year 2016-17.

The report clarified that the deficit declined as a result of a contained wages bill and lower interest payments, coupled with a continued strong tax performance, despite increases in spending on subsidies and transfers.

“Gross public debt declined from 103 percent of GDP in fiscal year 2016/17 to 92.5 percent of GDP in fiscal year 2017/18,” the report noted.

It also pointed to the current account deficit which dropped from 6.1 percent of GDP in fiscal year 2016/17 to 2.8 percent in fiscal year 2017/18, as a result of the strong pick-up in tourism receipts, exports (oil, non-oil), Suez Canal revenues, and private transfers, notably remittances, which more than offset increases in imports.

It continued the review by saying, “In recent months, Egypt has stepped up external borrowing and shifted away from costly short-term domestic debt to rebuild foreign exchange reserves, and reduce crowding out of credit to the private sector.”

International reserves rebounded to surpass pre-2011 levels, reaching a record high of $44.5 billion in September 2018, and covering close to 7 months of imports, up from a critically low level of 3.1 months in June 2016, according to the report.

The bank expected GDP to grow to 5.5 percent in fiscal year 2018/19 and to 5.8 percent in fiscal year 2019/20.

It noted that this acceleration will be supported by the continued boost in confidence, recovery in tourism, an increase in foreign direct investment, improved competitiveness and continued strengthening of exports, the start of natural gas production from the Zohr field, as well as the implementation of business environment reforms and prudent macroeconomic policies.

The report also anticipated GDP to continue its growth in the short term in nominal dollar terms.

“The main risks to the outlook arise from a slow-down in reforms, and increases in global oil prices which would delay fiscal consolidation. These risks are mitigated by the authorities’ strong commitment to, and ownership of, the economic reform program,” the report explained.

According to the bank, “The Transition Report 2018-19” analyses the impact on work of demographic change, as well as automation and migration, both across national borders and within countries. The report includes a macroeconomic overview of the EBRD regions and of structural reforms in the past year.

Egypt embarked on a bold economic reform program that included the introduction of taxes, such as the value-added tax (VAT), and cutting energy subsidies, with the aim of trimming the budget deficit.

Egypt also provides facilities and legislative reforms to encourage investors to invest in Egypt.

The legislative and regulatory aspects include the issuance of several laws and regulations, namely the new investment law and its executive regulations; the law of restructuring and reconciliation, bankruptcy and postponement of financing and privatization; and the amendments of the law of companies and the capital market and their executive regulations.

The state also established the investors’ service center that provides services to aid in the procedures of establishing a firm, its contract, documentation, licensing and its commercial registration.

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Pyramids Marathon: A Race through Egypt’s ancient history

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Thousands of runners are now getting ready for the Pyramids Marathon, an iconic event that invited runners from around the world to participate in the race held in Egypt’s greatest landmark, the Pyramids.

Participants range from all ages and nationalities, to complete the course of 10K, 21K or the 42K!

The Pyramids Marathon is organized by the TriFactory, an Egyptian sports management company, that specializes in mass participation sports events just like this one.

Good news is, for those who missed the chance of participating and want to witness the event, a live tracking system is available on their website. So make sure to follow your friends and family complete this run through Egypt’s ancient history!

https://www.pyramidsmarathon.com/livetracking?fbclid=IwAR0o1vUFOqGIePeG49FOkn1syCr4QAPQJ35WpKYYSqlClWETjt_wZ_l3amg

Minister of Tourism Rania Al-Mashat is of course apparent in the picture and is taking part of the race; she explains how this event will help in maintaining a good image for our nation on a global scale.

We can’t wait to see the results of this race, and the participants’ feelings about taking part of such an incredible event.

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Crowds brave snow to see UK royals Meghan and Harry

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BRISTOL, England – 1 February 2019: Prince Harry and his wife Meghan thanked crowds of well-wishers for braving wintry conditions to welcome them on a trip to southwest England on Friday.

“I hope everyone gets a nice cup of tea after this,” Meghan said as she and her husband chatted to those who had waited in the cold to see them as snow fell.

Harry and Meghan, a former actress who is expecting their first child this Spring, were in Bristol where they visited the city’s Old Vic, built in 1766 and the oldest continuously working theatre in the English-speaking world.

Later, they were due to visit Empire Fighting Chance, a charity which seeks to use boxing to try to help young people, who are failing at school or at risk of drifting into unemployment or crime, turn their lives around

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Establishing Russian Industrial Zone in Egypt comes into force

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CAIRO – 1 February 2019: President Abdel Fatah Al Sisi issued decree No. 420 of 2018 approving an agreement between the governments of Egypt and Russia concerning the establishment and operation of the Russian Industrial Zone in the Suez Canal Economic Zone in Egypt, which was signed in Moscow on May 23, 2018.

The decree was published in the official gazette Al-Waqa’i’ al-Misriyya on Jan. 23, 2019. As per the Egyptian constitution, any presidential decree shall be published in the official gazette to come into force.

Since February 2015, Egypt and Russia have been negotiating $7 billion worth of Russian investments in the Russian Industrial Zone (RIZ) project in the East Port Said region.

RIZ would be established on an area of 5.25 million square meters and will be built over three phases, according to a statement issued by the Suez Canal Economic Zone.

The project will be conducted on three phases, the first phase involves 1 million square meters, will be carried out by a Russian developer who will also work on attracting Russian investors and companies throughout 2018 and 2019. This phase will create 7,300 jobs in the construction field.

The second phase will develop 1.6 million square meters and will be finished by 2022, creating 10,000 jobs, while the third phase will develop 2.65 million square meters and generate 17,000 jobs.

The three phases are expected to be finished by 2031, when Russian companies will start operations, providing some 35,000 direct and indirect jobs, the statement said.

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