egypt - monthly economic review - march 2014 · egypt’s foreign reserves increased slightly to...

African Development Bank

This Report is the first of a series

of Economic Monthly Reviews

on Egypt by the African

Development Bank’s Country

Office in Cairo. It covers

Egypt’s key economic

headlines, topic of special

focus, and statistics, based on

data, which was available at

the time of its publication. It

comprises the following:

Economic Headlines p. 1

Topic of Special Focus p. 2

Egypt Fact Sheet p. 5

Development and

Macroeconomic Indicators p. 6

Statistics and Charts p. 7

Jacob KOLSTER Director, North Africa Region [email protected] Tel: +216 7110 2065 Leila MOKADDEM Resident Representative Email: [email protected]

Tel: +202 22 563 790/1 Charles MUTHUTHI Chief Country Economist Email: [email protected] Tel: +202 22 563 790/1

www.afdb.org This Report was Prepared by Charles Muthuthi (Chief Country Economist, EGFO), Ahmed Ibrahim (Research Assistant, EGFO), and Zeinab Hassan (Statistical Assistant, EGFO)

March 2014 Headlines

1: Business activity continues to underperform according to the HSBC Egypt Purchasing Managers Index (PMI). HSBC’s March 2014 poll indicates that economic activity in Egypt remains weak in the non-oil private sector. The PMI that stood at 50 in February contracted marginally to 49.8 indicating deterioration in business conditions. The rate of new order placements slowed, and there were

higher job losses in March. However, the pace of job destruction slowed in March, for the first time since September 2012. While 16% of those polled indicated that economic activity had contracted, 18% reported growth. But there were bad news in that firms pointed to rising cost of raw materials because of upward inflationary pressures. However, payroll costs increase was marginal with many sectors indicating no wage changes. 2: The budget deficit narrowed by over 2 percentage points to 6% during the 8 months to February 2014, compared to the same period last year. As a % of GDP, government revenues surged to 12.4%, from 10.5% a year earlier. Increases in grants were noticeable, growing by EGP 30 billion because of transfers of deposits from the Central Bank of Egypt (CBE) and receipt of EGP 20 billion grants in cash

from the Gulf. Gulf aid to Egypt is likely to continue after the presidential elections in May that ex-Army Chief Abdel Fattah al-Sisi is expected to win. Meanwhile expenditures grew by 13.2%, with wages—the topic of special focus in this issue—increasing by EGP 20 billion. Interest service payments and pensions also increased by EGP 12 billion, and EGP 11.5 billion, respectively. 3: The government continues to prepare the ground for subsidy reforms. The ministry in charge of supplies and internal trade announced in March that the baladi (bread) subsidy distribution system was a failure as a quarter of the product is lost through smuggling and wastage. A new system that entails the government selling flour to bakeries at market prices will be piloted in Port Said starting April 2014. The government is also working towards reforming energy subsidies that consume over 20% of the budget and that mostly benefit the rich. The smart card

system scheme had registered 1.3 million car owners by March. The government envisages that the fuel smart cards will help it develop strategies for rationalizing the distribution and consumption of petroleum products in the near future.

4: The balance of payments stood at USD 2 billion surplus in December 2013. Egypt’s foreign reserves increased slightly to USD 17.4 billion in March of 2014 from USD 17.3 billion in February of 2014. The current account deficit narrowed to USD 0.76 billion in December 2014 because of inflows of official transfers from the Gulf, that reached USD 6 billion. Furthermore, the trade deficit declined by 17% as a result of a 7.4% contraction in merchandise imports. However, the services surplus worsened to USD 0.2 billion from USD 3.9 billion in December 2012, as tourism revenues contracted sharply by 66% to USD 1.9 billion as tourists continued to stay away.

5: The CBE has announced that it has cleared the backlog of funds that foreign

investors wished to repatriate. The CBE announced that the dollar amount involved was substantial without disclosing the figure. Meanwhile the CBE continued with the foreign currencies auctions it initiated in December 2012. During the auction on March 17, the CBE sold USD 38.3 million at EGP 6.9575/USD, while the pound was exchanging in the black market at EGP 7.4/USD. News from the Egyptian stock exchange (EGX) show that the EGX 30 continued to rally, reaching a market capitalization of EGP 487 billion (24% of GDP) in March 2014, a level last seen in September 2008.

About This Report

AfDB Volume 1 │ March 2014 Egypt Economic Monthly Update


AfDB Egypt Economic Monthly Update

Egypt Country Office │ North Africa Region │ March 2014

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2

In January 2014 the government raised the

minimum monthly wages in the public sector to EGP 1,200, from EGP 700. This new minimum wage

law benefits government employees in ministries,

local and service authorities, and is expected to

burden public finances with an additional EGP 20

billion annually. Despite this extra burden on fiscal

finances, and possibly future employment

prospects in the public sector, the minimum wages

are expected to boost private consumption, and

consequently economic growth.

The extra spending will raise the fiscal deficit

beyond government’s own projections of 10% of GDP in FY 2013/14. Already, there is an increase of

EGP 10 billion (7% growth in the wage bill) during

the second half of FY 2013/14. This translates to a

1.7% increase in total government spending. As

such, total government expenditures that were 33%

higher than total revenues in FY 2012/13, are

expected to continue growing faster than revenues

to widen the budget deficit by about 2% in the

current and the next fiscal year.

In near future, the government’s ability to finance,

and create, employment opportunities in the public sector could diminish. The minimum wage

adjustments are being financed mainly by grants

and loans from the Gulf, an unsustainable source

finances. Without enhancing the productivity of the

public service to raise additional revenues the

government would need to revert to local borrow

to finance the extra spending. By already, public

debt reached a high of 98% of GDP in 2013. On the

other hand, generating additional revenue from

taxes seems difficult in light of the present sluggish

economic performance.

In the meantime, the “left out” employees in the

public sector have intensified strikes in demand for

the minimum wages to apply to their sectors as well. Around a quarter of the workers in the public

sector will not be able to reap the fruits of the new

wage legislation. As a result, employees in public

transportation services, public universities and

textile factories have already intensified strikes in

demand for pay raises. In response, the

government has promised to meet their demands

in the near future. This is expected to create

additional burden on an already worsening fiscal

position.

Yet, the annual increase in minimum income is

expected to enhance private consumption, and in turn, stimulate economic activity. The annual EGP

20 billion additional government spending

comprise about 1.5% of total private consumption.

Given that there is a positive relationship between

the government wage bill and private

consumption, private consumption is expected to

have a favorable impact on growth (Figure 1 ).

But growth in private consumption could slow because of increase in consumer prices. As the

disposable income of over 4.8 million public sector

workers rise, so will their private consumption. This

could drive up inflation that is trending in double

digits but had eased from an annual rate of 12.2%

in January 2014 to 10.2% in February, according to

Egypt’s statistical agency. Higher inflation could

erode consumer purchasing power and

confidence. Therefore, the expected new wage

policy feed through to growth through higher

private consumer spending may not be realized.

Public debate is ongoing whether a minimum wage law could also be introduced in the private sector.

The private sector employs about 75% of workforce.

While demands for higher compensation may arise

among those receiving below EGP 1,200 a month,

progress to introduce legislation on minimum

wages in the private sector is slowed by the high

unemployment rate. Furthermore, there are

questions as to what the impact of introducing

minimum wages could be on micro and small

enterprises that provide livelihoods for about nine

million workers.

0

50

100

150

200

250

2007 2008 2009 2010 2011 2012 2013

(EGP bn) Figure 1: Private Consumption & Government Wage s

Government Wage Bill Private Consumption

Topic of Special Focus – Egypt’s Minimum Wage Law




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3




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4

STATISTICS AND CHARTS




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Egypt Fact Sheet

Land area: 997,739 sq km, of which only 5% is inhabited and cultivated Population : Total 86.2(March 2014) In Major Towns (March 2014) : Cairo: 9,186,851 Alexandria: 4,716,220 Port Said: 654,495 Suez: 610,579

5

Economic Size and Structure 2012 2013 Competitiveness Index (Rank) 2011/144 2012/148

GDP (PPP) % of world total 0.66 0.65 Overall ranking 107/144 118/148

Real GDP growth (%) 2.2 2.1 Government budget balance 142/144 146/148

Real GDP per capita (USD) 2,970 3,112 Inflation, annual % of change 128/144 122/148

Egypt Voting Power 2013 2014 General government debt 122/144 129/148

IMF voting power (% of World) ... 0.4 Imports as % of GDP 116/144 109/148

IMF quota (SDR million) … 943.7 Exports as % of GDP … 134/148

AfDB voting power(% of Africa) 8.9 8.9 Infrastructure 83/144 98/148

Financial Indicators Ranking 2011 2012 Women labour force % to men 139/144 143/148

Availability of financial services 88/144 112/148 Labour market efficiency 142/144 146/148

Ease of access to loans 84/144 100/148 Human Development Index 2011 2012

Soundness of banks 123/144 125/148 Human development index 113/187 112/187

Local equity market financing 37/144 46/148 GNI per capita (2005 PPP$) 5,403 5,401

Doing Business 2013 2014 Life expectancy at birth 73.2 73.5

Doing business rank 127/185 128/189 Mean years of schooling 6.4 6.4

Starting business rank 44/185 50/189 Social & Governance Indicators 2012 2013

Construction permits 144/185 149/189 Corruption perception index 118/176 114/177

Registering property 106/185 105/189 Gender gap index 126/135 125/136

Getting credit 82/185 86/189 Freedom index (Rank) 125/178 135/178

Paying taxes 149/185 148/189 Political strength 91/129 107/129

Resolving insolvency 141/185 146/189 Economic strength 88/129 98/129

Tourism Indicators 2011 2013 Energy Indicators 2012 2013

Tourism Competitiveness 75/139 85/140 Energy performance 61/129 63/129

Safety and security 135/139 140/140 Energy security 52/129 47/129

Tourism infrastructure 88/139 90/140 Energy equity 56/129 59/129

Attract tourists 42/139 47/140 Environmental sustainability 81/129 84/129

Tourism expenditure 21/139 22/140 Contextual performance 90/129 102/129

Hiring and firing in tourism 76/139 113/140 Energy performance 61/129 63/129

Economic Freedom 2013 2014 Mo Ibrahim Index 2011 2012

Monetary freedom 174/178 175/178 property rights index 21/52 19/52

Trade freedom 106/178 123/178 Safety rule of law 20/52 30/52

Investment freedom 125/178 100/178 Participation & Human Rights 47/52 37/52

Source: African Development bank, Heritage Institution, International Monetary Fund, Human development Report (UNDP), Mo Ibrahim Foundation, Transparency

International, World Bank, World Economic Forum and World Energy Council.




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6

Development and Macroeconomic Indicators 2008 2009 2010 2011 2012 2013 2014(p) 2015(p)

Development Indicators

Unemployment rate (%) 8.7 9.4 9 12 12.7 13.6 13.5 13

Labor force participation rate (%) 32.8 33.1 33.4 33 32.7 32 … …

Age (15-24) Labor force participation rate

51.4 54.59 51.9 52.2 52.4 … … …

Poverty headcount ratio at national poverty rate (%)

… 21.6 … 25.2 … 26.3 … …

Economic Indicators

Real GDP growth (Annual % Change)

7.2 4.7 5.1 1.8 2.2 2.1 2.1 3.4

Consumption as % of GDP (Market Prices)

83.2 87.4 85.7 87 92 93.2 94 95.5

Investment as % of GDP (Market Prices)

22.4 19.2 19.5 17.1 16.4 14.2 15 16.5

Domestic savings (% of GDP) 16.8 12.6 14.3 13 9.1 15.8 ... ...

Exports as % of GDP (Market Prices)

33 25 21.3 20.6 17.4 17.3 17.8 18.5

Imports as % of GDP (Market Prices)

83.6 31.6 26.6 24.7 25.8 24.7 25.4 26.5

Prices

CPI inflation (Annual % of Change)

20.2 9.9 10.1 11.8 7.3 9.8 12 9

EGP/US$ exchange rate (End of Period)

5.35 5.59 5.66 5.94 6 6.99 7.2 7

Budget Sector Indicators

Total revenues (% of GDP) 24.7 27.1 22.2 19.3 19.7 18.2 18.5 18.2

Tax revenue (% of GDP) 15.3 15.7 14.1 14 13.4 15 14.5 13.7

Other revenues(% of GDP) 9.4 11.4 8.1 5.3 6.2 7.1 5.9 6.1

Total expenditures (% of GDP) 31.5 33.7 30.3 29.3 30.5 29.7 31.6 29.5

Compensation of employees (% of GDP)

7 7.3 7.1 7 8 7.7 7.9 7.4

Interest payments (% of GDP) 5.6 5.1 6 6.2 6.8 7.5 7.9 7.9

Primary fiscal deficit (% of GDP) 1.2 1.8 2.1 3.6 4 5.3 4 3.5

Overall fiscal deficit (% of GDP) 6.8 6.9 8.1 9.8 10.8 13.7 13.1 11.3

External Sector Indicators

Balance of payments (% of GDP) 3.3 -1.8 1.5 -4.1 -4.3 0.1 -0.2 0.8

Current account balance (% of GDP)

0.5 -2.3 -2 -2.6 -3.9 -2.1 -1.1 -1.8

Trade balance (% of GDP) -14.4 -13.3 -11.5 -11.5 -13 -11.6 -12 -11.5

Exports/Imports (%) 55.6 50 48.7 49.9 42.3 45.2 … …

Service receipts/ Service payments

222.2 210.7 178.2 156.3 136.5 143.1 … …

FDI in Egypt (net) (% of GDP) 8.1 4.3 3.1 0.9 0.8 2 ... ...

Debt Indicators

Total government debt as % of GDP

86.4 86.3 86 87.9 88.4 98.5 … …

Gross domestic debt (% of GDP) 73.5 72.5 73.6 76.2 78.6 87.1 … …

Gross external debt (% of GDP) 20.1 16.9 15.9 15.2 13.2 17.3 19 21

External debt per capita (US$) 450 418.6 399.2 413.6 389.7 489.9 … …

Domestic debt per capita (EGP) 8,740 10,027 10,529 12,380 14,032 17,307 … …

364 Day T-bills rate ((annual average)

7.8 12.1 10.5 11.5 14.8 14.4 .. ...

External debt service (% of exports)

4.6 6.4 5.5 5.7 6.1 8 7.9 7.9

Net international reserves (US$ billion)

34.6 31.3 35.2 26.6 15.5 16 ... ...

NIR as months of commodity imports

7.9 7.5 8.6 6.3 3.2 4.3 3.6 ...

Source: African Economic Outlook , Central Agency for Public Mobilization And Statistics , Central Bank of Egypt, International Monetary Fund, Ministry of Finance, World

Development Indicators, and AfDB Staff Projections(p)




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-5.0-4.0-3.0-2.0-1.00.01.02.03.04.05.06.0(%)

Real GDP Growth Rate

419

49 76

98

506

55 69 111

-

100

200

300

400

500

600

Consumption Investment Exports Imports

(EGP bn) Egypt Expenditure on GDP (Market Curent Prices)

Q1 2013 Q1 2014

3.0

-0.1

2.8 5.4

0.6

-3.4

2.9

-3.5

1.6 4.5

-28.3

-0.4

-30

-25

-20

-15

-10

-5

0

5

10Origin of GDP Growth Rate (Selected Sectors)

Jul/Sep2013

Jul/Sep2014

Gross Domestic Product (GDP)

GDP Growth Rates (%)

Fiscal Year Q2 Q3 Q4 Q1 Q1

2012 2013 2013 2013 2013 2013 2014

Real GDP at

Market Price 2.2 2.1 2.2 2.2 1.5 2.5 1.0

Real GDP Per

Capita -0.03 -0.01 -0.6 -0.6 -1.3 -0.2 -1.4

Source: Egyptian Ministry of Finance

Real Sector(Market Current Prices) (EGP billion)

Fiscal Year Q2 Q3 Q4 Q1 Q1

2012 2013 2013 2013 2013 2013 2014

GDP at Market

Prices 1,576 1,753 438 424 446 446 518

Consumption 1,450 1,628 408 387 409 419 506

Investment 258 249 68 63 74 49 55

Exports 275 309 77 79 77 76 69

Imports 407 432 116 106 113 98 111

Source: The Central Bank of Egypt

Origin of GDP (Growth Rate, Constant price) (%)

Fiscal Year Jul/ Dec Jul/ Mar Apr/ Jun Jul/ Sep Jul/ Sep

2012 2013 2013 2013 2013 2013 2014

Agriculture,

Forestry & Fishing 2.9 3.0 2.9 3.1 2.9 3.0 2.9

Extractions 0.1 -2.7 -0.7 -2.5 -3.2 -0.1 -3.5

Manufacturing

Industries 0.7 2.3 2.4 2.5 1.4 2.8 1.6

Electricity 5.9 4.6 6.8 5.3 2.7 6.8 1.3

Water 4.6 4.1 4.0 4.3 3.4 4.4 3.1

Construction &

Building 3.3 5.9 4.5 6.6 4.2 5.4 4.5

Communications 5.2 4.9 4.4 5.4 3.8 5.1 4.1

Suez Canal 3.9 -3.8 -3.6 -4.2 -2.8 -3.4 -0.4

Tourism 2.3 6.6 6.8 10.2 -5.2 0.6 -28.3


Suez Canal & Tourism

Suez Canal Revenues (USD million)

Fiscal Year 2013 2013 2013 2012 2013

2012 2013 Aug Sep Oct Nov Nov

Suez Canal

Revenues 5,208 5,032 445 442 466 428 442

Source: Central Agency for Public Mobilization And Statistics (CAPMAS)

0

100

200

300

400

500

De

c-1

2

Jan

-13

Feb

-13

Mar

-13

Ap

r-13

May

-13

Jun

-13

Jul-

13

Au

g-13

Sep

-13

Oct

-13

No

v-1

3

(US$ mn) Suez Canal Revenues

7

Statistics and Charts




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Tourism Revenues (USD billion)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Q 2 Q 3 Q4 Q1 Q1

Tourism

Revenues 9.4 9.8 2.9 2.5 1.7 2.6 0.9


Unemployment Rate

Calender Year 2013 2013 2013 2012 2013

2012 2013 Q1 Q2 Q3 Q4 Q4

Unemployment

Rate (%) 13.0 13.4 13.2 13.3 13.4 13.0 13.4

Labor Force

(million) 27.0 27.3 27.2 27.2 27.2 27.0 27.3

Souorce: Central Agency for Public Mobilization And Statistics (CAPMAS)

Monetary Sector

Domestic Liquidity (EGP billion)

Fiscal Year 2013 2013 2013 2012 2013

2012 2013 Sep Oct Nov Dec Dec

Reserve Money

(M0)

264

318

339

335

338

264

336

Domestic

Liquidity ( (M2)

1,094

1,296

1,335

1,348

1,360

1,167

1,387

Money Supply

(M1)

275

344

366

369

370

288

374

Quasi-Money

820

952

969

979

991

879

1,014 Source: The

Central Bank of

Egypt

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0(US$ bn) Tourism Revenues

10.5

11.0

11.5

12.0

12.5

13.0

13.5

14.0

(%) Unemployment

1,100

1,150

1,200

1,250

1,300

1,350

1,400

1,450

(EGP bn) Domestic Liquidity (M2)

Bank Deposits (EGP billion)

Fiscal Year 2013 2013 2013 2012 2013


Total Deposits 1026.7 1190.7 1230.2 1241.5 1262.2 1090.0 1316.0

Governmental 118.6 126.7 143.7 142.7 147.2 121.0 170.7

Non-

Governmental 908.1 1063.9 1086.5 1098.8 1115.0 969.6 1145.0


Suez Canal & Tourism Traffic (million)

Fiscal Year 2013 2013 2013 2012 2013


Total Vessels

(Thousands) 17.7 16.7 1.4 1.5 1.4 1.4 1.5

Number of

Tourist Arrivals 11.0 12.2 0.3 0.6 0.7 1.0 0.7

Number of

Nights 124.6 131.8 1.1 3.9 5.1 1.4 5.1

Source: Suez Canal Authority and Central Bank of Egypt

1,000

1,050

1,100

1,150

1,200

1,250

1,300

1,350

(EGP bn) Total Deposits (EGP bn)

8




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9

Credit Facilities (EGP billion)

Fiscal Year 2013 2013 2013 2012 2013


Total Credit

Facilities 507.0 549.1 549.5 550.0 550.2 516.8 550.0

Government 34.0 35.8 38.2 38.4 37.2 35.0 41.6

Non-

Government 473.0 513.3 511.3 511.6 513.0 481.7 508.7


Foreign Asets & Liabilities (EGP billion)

Fiscal Year 2013 2013 2013 2012 2013


Net Foreign

Assets of the

Banking System 158.0 123.0 124.5 122.0 116.5 133.4 117.6

Central Bank of

Egypt 76.0 38.0 43.0 42.1 40.2 49.1 38.0

Banks 82.0 84.6 81.5 79.9 76.2 84.0 79.2


Financial Sector

Inflation (%)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Nov Dec Jan Feb Feb

Inflation Rate 7.3 9.8 13.0 11.7 11.4 8.2 9.8

Core Inflation

Rate 7.0 8.6 12.0 11.9 11.7 7.7 9.7

PPI -3.7 8.4 9.8 .. .. -0.8 ..

Source: The Ministry of Finance

Number of Listed Companies (billion)

Fiscal Year 2013 2013 2013 2012 2013


No. of listed

companies

(Unit) 0.2 0.2 0.2 0.2 0.2 0.2 0.2

No. of listed

shares 40.0 40.1 40.3 40.3 41.0 40.1 41.1

Listed capital (

LE ) 150.1 152.1 152.6 152.7 153.0 151.4 156.7


Monthly Interest Rates (%)

Fiscal Year 2013 2013 2013 2012 2013


Lending Rate

(less than 1 year

loan) 11.9 12.6 12.2 12.2 12.1 12.2 11.9

1-3 Month

Deposit 7.7 8.0 7.7 7.4 7.2 7.6 7.0

3 Month TBs 14.6 14.1 11.2 10.9 10.9 13.1 10.5

Source: The Egyptian Ministry of Finance

0

100

200

300

400

500

600(EGP bn) Credit Facilities

Credit For Government

Credit for Non-Government

0

20

40

60

80

100

120

140

160

(EGP bn) Foreign Assets & Liabilities

Central Bank of Egypt

Banks

Net Foreign Assets of the Banking System

0

2

4

6

8

10

12

14

(%) CPI & Core Inflation Rate

Inflation Rate (CPI urban)

Core Inflation Rate (CPI Urban)

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

(%) 3 Month TBs




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Stock Market Exchange

Fiscal Year 2013 2013 2014 2013 2014


EGX 20 5452.0 5210.7 7234.6 7899.7 8816.0 6422.9 9765.0

EGX 30 4708.6 4752.0 6184.1 6782.8 7405.0 5489.5 8127.0

EGX 70 422.0 360.2 518.6 542.2 584.6 471.2 651.2

EGX 100 729.5 643.0 866.9 923.2 992.0 796.6 1119.0

Nile .. 839.2 1141.6 1156.8 1086.0 … 1049.9

Source: The Egyptian Stock Exchange

Fiscal Sector Total Revenues (EGP billion)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Oct Nov Dec Jan Jan

Total Revenues 303.6 350.3 23.3 44.8 48.7 16.8 42.5

Tax Revenues 207.4 251.1 16.5 12.1 35.3 13.9 30.1

Taxes on

Income 91.2 117.8 6.6 3.1 23.1 3.8 18.7

Taxes on

Property 13.1 16.5 2.1 1.3 1.3 1.7 1.6

Taxes on

Goods and

Services 84.6 92.9 6.7 6.6 8.6 7.3 7.5

Taxes on

International

Trade 14.8 16.8 1.0 1.1 2.3 1.2 2.3

Non-Tax

revenues 96.2 99.2 6.8 32.7 13.3 2.9 12.4

Grants 10.1 5.2 0.0 29.8 0.1 0.0 0.4

Source: AfDB based on Data by the Egyptian Ministry of Finance

Expenditure (EGP billion)

Fiscal Year 2013 2013 2013 2013 2014


Total

Expenditures 471.0 588.2 37.6 35.9 71.3 45.4 71.5

Compensation

of Employees 122.8 143.0 12.3 11.5 11.4 10.5 15.1

Purchases of

Goods and

Services 26.8 26.7 1.9 1.9 2.3 2.3 2.2

Interest 104.4 147.0 12.9 10.0 9.3 14.3 15.9

Subsidies 150.2 197.1 4.5 2.8 32.8 10.7 28.0

Grants 35.9 39.5 0.3 0.2 1.0 0.1 0.3

Social benefits 5.3 5.0 0.4 2.8 5.6 1.7 2.5

Purchases of

Non-Financial

Assets 9.4 20.8 2.3 3.3 5.5 3.0 4.0

Source: AfDB based on Data by the Egyptian Ministry of Finance

Budget Deficit ( EGP billion, otherwise indicated)

Fiscal Year 2013 2013 2014 2013 2014

2012 2013 Jul/ Nov Jul/ Dec Jul/ Jan Jul/ Feb Jul/ Feb

Overall Fiscal

Deficit 166,7 237,9 66.0 89.4 119.6 146.5 123.6

Overall Deficit/

GDP (%) 10.6 13.7 3.2 4.4 5.8 8.4 6.0

Revenues/ GDP

(%) 19.3 20.0 6.2 8.6 10.6 10.5 12.4

Expenditure/

GDP (%) 29.9 33.5 9.3 12.8 16.3 18.8 18.2 Source: AfDB based on Data by the Egyptian Ministry of Finance

01,0002,0003,0004,0005,0006,0007,0008,0009,000

2/1

/20

13

28

/01

/20

13

19

/02

/20

13

13

/03

/20

13

4/4

/20

13

29

/04

/20

13

26

/05

/20

13

17

/06

/20

13

10

/7/2

01

3

4/8

/20

13

29

/08

/20

13

22

/09

/20

13

21

/10

/20

13

13

/11

/20

13

5/1

2/2

01

3

29

/12

/20

13

23

/01

/20

14

16

/02

/20

14

EGX 30

185

137

48

254

149

105

0

50

100

150

200

250

300

Total Revenues Tax Revenues Non-Tax revenues

(EGP bn) Revenues

Jul-Feb 2013 Jul-Feb 2014

329.9

88.6 83.4 89.1

373.3

108.2 95.4 80.7

0.0

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

TotalExpenditures

Salaries Interest Subsidies

(EGP bn) Expenditure


8.4

10.5

18.8

6.0

12.4

18.2

0.0

5.0

10.0

15.0

20.0

Overall Deficit/GDP

Revenues/ GDP Expenditure/ GDP

(% Of GDP) Fiscal Sector Indicators





www.afdb.org

External Sector

Current & Financial Account (USD billion)

Fiscal Year 2013 2013 2014 2013 2014

2012 2013 Q3 Q4 Q1 Jul/Dec Jul/Dec

Current

Account -10.2 -5.6 -0.8 -1.7 0.8 -4.9 -0.8

Capital &

Financial

Account 1.0 9.7 0.0 5.4 4.0 6.4 3.0

Capital

Account -0.1 -0.1 0.0 0.0 0.0 -0.1 -0.1

Financial

Account 1.1 9.8 0.0 5.4 4.0 6.5 3.0


11

External Sector Indicators (%)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Q 2 Q3 Q4 Q1 Q1

Exports /

Imports 42.3 45.2 39.6 47.6 44.3 43.5 43.6

Service Receipts

/ Payments 136.5 143.1 158.0 140.0 131.2 141.2 103.5

Current

Receipts /

Payments 86.4 92.4 86.4 95.1 90.4 92.9 104.3

Current

Account / GDP -3.9 -2.1 -1.0 -0.3 -0.7 -0.4 0.3

Overall Balance

/ GDP -4.3 0.1 0.0 -0.6 0.9 -0.2 1.3 Source: The Central Bank of Egypt

EGP Exchange Rate

Fiscal Year 2013 2013 2014 2013 2014


USD 6.0 7.0 6.9 6.9 6.9 6.7 7.0

Euro 7.8 9.2 9.3 9.4 9.5 9.0 9.6

Pound Sterling 9.6 10.8 11.1 11.3 11.5 10.4 11.7

Source: The Egyptian Ministry of Finance

-3.00

-2.50

-2.00

-1.50

-1.00

-0.50

0.00

0.50

1.00

Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q4 Q1 Q2 Q3 Q4 Q1

2011 2012 2013 2014

(US$ bn) Current Account

0

20

40

60

80

100

120

140

160

180

200

Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q4 Q1 Q 2 Q3 Q4 Q1

2011 2012 2013 2014

(%) Service Receipts / Service Payments

6.6

6.7

6.7

6.8

6.8

6.9

6.9

7.0

7.0

7.1

US$ Exchange Rate

Foreign Direct Investment (FDI) (USD billion)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Q2 Q3 Q4 Q1 Q1

Net FDI 4.0 3.0 0.2 1.1 1.6 1.2 1.3

EU Inflows 9.5 5.0 1.3 1.0 1.5 1.2 1.5

USAInflows 0.6 2.2 0.6 0.4 0.5 0.7 0.6

Arab Countries

Inflows 1.2 1.5 0.3 0.6 0.4 0.2 0.2


-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

(US$ bn) Net FDI




www.afdb.org

Net International Reserves (USD billion)

Fiscal Year 2013 2013 2014 2013 2014


Net

International

Reserves 15.5 14.9 17.8 17.0 17.1 13.5 17.3


12

Trade Balance (USD billion)

Fiscal Year 2013 2013 2013 2012 2013

2012 2013 Jul Aug Sep Oct Oct

Trade Balance -34 -32 -4 -3 2 -3 -3

Export 25 26 2 2 5 2 2

Import -59 -58 6 5 -2 6 5 Source: CAPMAS

Pharmaceuticals (USD million)

Jun13 Jul 13 Aug13 Sep 13 Oct 13 Nov 13 Dec 13

Exports 40 27 25 42 35 39 53

Imports 214 137 141 153 148 121 151

Source: General Organization for Export & Import Control (GOEIC)

Building Materials (USD million)


Exports 466 324 246 374 267 318 352

Imports 722 1014 601 592 577 609 644

Source: General Organization for Export & Import Control

Leather (USD million)


Exports 17 13 14 16 15 18 16

Imports 16 14 13 14 13 8 11


Chemicals and fertilizers (USD million)


Exports 378 352 388 432 279 375 369

Imports 696 724 640 653 619 525 653


0

5

10

15

20

25

(US$ bn) Net International Reserves

-6

-4

-2

0

2

4

6

8(US$ bn)

Trade Balance

Trade Balance Export Import

0

200

400

600

800

1000

1200

(US$ mn) Building Materials

Exports Imports

0

200

400

600

800

1000

(US$ mn) Chemicals & Fertilizers

Exports Imports




www.afdb.org

13

Ready made garments (USD million)


Exports 131 131 109 124 105 107 129

Imports 38 31 20 45 55 43 40


Home wear (USD million)


Exports 57 57 41 74 54 67 71

Imports 9 10 10 6 9 10 18


Engineering and electronics (USD million)


Exports 188 156 120 224 147 151 200

Imports 1410 1345 1123 1090 1220 860 1174


Spinning and weaving (USD million)


Exports 80 67 63 84 81 75 103

Imports 227 219 181 172 173 145 212


Media commodities (USD million)


Exports 6 4 2 2 1 1 1

Imports 4 6 10 8 4 4 3


Furniture (USD million)


Exports 34 32 17 29 26 26 33

Imports 112 133 96 118 108 89 130


0

20

40

60

80

100

120

140

160

(US$ mn) Ready Made Garments

Exports Imports

0

10

20

30

40

50

60

70

80

(US$ mn) Home Wear

Exports Imports

0

50

100

150

200

250

(US$ mn)

Spinning & Weaving

Exports Imports

0

20

40

60

80

100

120

140

160

(US$ mn) Furniture

Exports Imports




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14

Fresh produce (USD million)


Exports 219 88 46 89 87 94 178

Imports 176 179 207 224 177 249 300


Food Industry (USD million)


Exports 272 243 182 258 219 230 233

Imports 500 523 506 470 444 323 389


Debt

Debt Per Capita

Fiscal Year 2013 2013 2014 2013 2014

2012 2013 Q3 Q4 Q1 Q2 Q2

Gross Domestic

Debt per

Capita ( million

EGP) 14 13 17 17 18 16 19

External Debt

per Capita

(USD) 390 490 440 490 533 440 …


External Debt (%)

Fiscal Year 2013 2013 2013 2013 2014

2012 2013 Q2 Q3 Q4 Q1 Q1

External Debt /

GDP 14 17 14 15 17 12 16

Government

External Debt/

GDP 10 11 9 10 11 9 10

External Debt/

Exports of

Goods &

Services 75 90 308 323 389 276 475


Domestic Debt (%)

Fiscal Year 2012 2013 2013 2012 2013

2012 2013 Q1 Q2 Q3 Q4 Q4

Total Domestic

Public

Debt/GDP 79 88 76 79 83 79 88

Domestic

Government

Debt/Domestic

Public debt 80 83 81 82 83 80 83

Government

Debt (net) /

GDP 63 72 62 64 69 63 72


0

100

200

300

400

500

600

(US$ mn) Fresh Produce

Exports Imports

0

100

200

300

400

500

600

(US$ mn) Food Industry

Exports Imports

0

5000

10000

15000

20000

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2011 2012 2013 2014

(EGP ) Gross Domestic Debt per Capita

0

100

200

300

400

500

600

Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2011 2012 2013 2014

(US$) External Debt per Capita




www.afdb.org

15

Fresh produce (USD million)


Exports 219 88 46 89 87 94 178

Imports 176 179 207 224 177 249 300


Debt Service (EGP billion)

Fiscal Year 2013 2013 2013 2013 2014


Total

Government

Debt Service 141 218 26 18 27 32 -20

Interest

Payments 104 147 13 10 9 14 4

Domestic Debt 101 143 12 10 9 14 4

Foreign Debt 3 4 1 0 0 1 0

Principal

Payments 36 71 13 8 17 18 -24

Domestic Debt 21 60 12 8 16 14 -27

Foreign Debt 15 11 0 0 1 4 3

Source: AfDB based on data by the Ministry of Finance

Manufacturing Indexes Growth Rates (%)

Total Manufacturing and Production Index (%)

Jan 13 Feb 13 Mar 13 Apr 13 May 13 Jun 13

Manufacturing Index 142.61 150.33 166.5 160.9 149.6 144.4

Manufacturing Index Growth

Rate 0.3024 5.4 10.76 -3.36 -6.9652 -3.476

Production Index 206.3 195.6 185.6 179.5 ….. …..

Production Index Growth Rate 7 3 3 0.5 ….. …..

Source: AfDB based on data by the CAPMAS & Ministry of Planning

Mining & Others (%)

Aug 13 Sep 13 Oct 13 Nov 13 Dec 13 Jan 14

Mining & Quarrying (Others) 37.56 47.82 51.48 54.43 72.51 60.24

Medical & Optical Instruments 113.2 99.51 121.7 103.5 84.91 62.41

Others 72.91 68.98 66.16 99 84.69 55.9

Source: CAPMAS

Clothing (%)


Textiles 91.3 82.52 78.81 73.49 76.71 78.74

Apparel & Dressing 229 253.1 233.2 219.1 257.3 224

Tanning & leather Products 18.11 19.08 17.07 18.75 20.41 24.93

Source: CAPMAS

76

12

78

16

0

20

40

60

80

100

Gross Domestic Debt / GDP External Debt / GDP

(%) Debt Indicators

Q1 2013 Q1 2014

123.1

73.5

49.6

166.9

85.5 81.4

0

20

40

60

80

100

120

140

160

180

Total GovernmentDebt Service

Interest Payments Principal Payments

(EGP bn) Total Debt Service

July-Jan 2013 Jul-Jan 2014

0

20

40

60

80

100

120

140

160

180

(%) Manufacturing Index

0

50

100

150

200

250

300(%)

Clothing

TextilesApparel & DressingTanning & leather Products




www.afdb.org

16

Chemical& Mineral Products (%)


Chemical Products 132.5 164.9 139.5 143.6 154.6 167.3

Rubber & Plastics 71.31 121.4 117.5 115.7 110.5 96.52

Non-Metallic Minerals(Others) 130.9 180.5 190.6 206.8 209.6 188.1

Source: The Central Agency for Public Mobilization And Statistics

Mining & Others (%)


Mining & Quarrying (Others) 37.56 47.82 51.48 54.43 72.51 60.24

Medical & Optical

Instruments 113.2 99.51 121.7 103.5 84.91 62.41

Others 72.91 68.98 66.16 99 84.69 55.9

Source: CAPMAS

Paper & Printing Products (%)


Paper Products 164.8 168.6 195.2 210.6 188.1 255.4

Publishing, Printing 165.7 209.2 161.6 168.6 184.9 249.4


Equipments (%)


Machinery & Equipment 106.8 140.3 107.1 124.2 156.2 130.1

Office& Computing Equipment 44.54 83.43 46.6 58.58 110.7 97.62

Electrical Machinery 68.16 109.1 85.03 79.2 103.3 102.7


Metal (%)


Basic Metals 76.54 87.6 102.6 96.18 104.4 99.15

Fabricated Metal Products 88.2 122.9 108 104 130.4 131.4


Wood & Furniture (%)


Furniture 72.91 68.98 66.16 99 84.69 55.9

Wood & Cork 52.91 84.85 58.73 83.19 94.98 87.36


Food, Beverages & Tobacco (%)


Food & Beverages 113.4 139.7 127.5 142 138.7 136.3

Tobacco Products 61.43 95.71 86.9 101.6 117.4 125.4


0

50

100

150

200

250(%) Chemical & Mineral Products

Chemical ProductsRubber & Plastics Non-Metallic Minerals(Others)

0

50

100

150

200

250

300(%)

Paper & Printing

Paper Products Publishing, Printing

0

50

100

150

200

250(%) Equipments

Machinery & EquipmentOffice& Computing Equipment Electrical Machinery

0

20

40

60

80

100

120

140

160

180(%) Food, Beverages & Tobacco

Food & Beverages Tobacco Products




www.afdb.org

17

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

(1000 Ton) Petroleum Consumption, Exports & Imports

Petroleum Products Local Consumption (1000 Ton)Petroleum Exports (EGP mn)Petroleum Imports (EGP mn)

Energy Sector

Petroleum Consumption, Exports & Imports

Jun 13 Jul 13 Aug 13 Sep 13 Oct 13 Nov 13 Dec 13

Petroleum

Products Local

Consumption

(1000 Ton)

2,970 2,970 2,844 2,564 2,896 2,885 3,038

Petroleum

Exports (EGP

million)

3,542 3,542 4,106 3,440 4,757 4,090 3,600

Petroleum

Imports (EGP

million)

7,230 7,229 2,770 1,401 2,259 2,928 3,776


Natural Gaz, Butagaz, Condensers & Oil Production (1000 Ton)

Jun 13 Jul 13 Aug 13 Sep 13 Oct 13 Nov 13 Dec 13

Natural Gaz

Production 3,511 3,511 3,564 3,428 3,524 3,302 3,353

Natural Gaz

local

Consumption

3,250 3,250 3,365 3,220 3,161 2,978 3,119

Oil, Butagaz &

Condensers

Production

2,922 2,922 3,004 2,941 3,057 2,895 3,016


Electricity (billion K.W)

May 13 Jun 13 Jul 13 Aug Sep Oct Nov

Electricity

Generated

14

15

16

16

15

13

13

Electricity

Consumption

12

13

12

12

12

12

12


0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

(1000 Ton) Natural Gaz, Oil Production & Consumption

Natural gaz production

Natural gaz local consumption

Oil, Butagaz and Condensers Production ( 1000 Ton)

0

2

4

6

8

10

12

14

16

18

(bn K.W) Electricity Production & Consumption

Electricity Generated Electricity Consumption


About the African Development Bank (AfDB) The African Development Bank (AfDB) is Africa’s premier development finance institution

established in 1964 to mobilize resources for the economic and social development of its 53

regional member countries. The Bank’s membership includes 24 non-regional member countries

bringing the total number of member countries to 77.

The Bank has been financing development activities in it regional member countries through its

three windows of financing: the African Development Bank (ADB) window, the African

Development Fund (ADF) window and the Nigerian Trust Fund (NTF) window.

About Egypt Egypt is one of the AfDB’s most important regional member countries. In addition to being one

of its founding members in 1964, Egypt is one of its top shareholders.

For More Background on AfDB Operations For more information about the African Development Bank, and its operations in Egypt, visit the

Bank’s website at: http://www.afdb.org/en/countries/north-africa/egypt/

Contacts Mrs. Leila Mokaddem Resident Representative

Email: [email protected]

Mr. Charles Muthuthi, Chief Country Economist

Email: [email protected]

African Development Bank Group

Egypt Country Office (EGFO)

72B Al Maahad Al Eshteraky St. Heliopolis

Opposite to Maryland Roxy/Heliopolis

Cairo, EGYPT

Tel: +202 22 563 790/1

Fax: +202 22 563 792 Ext: 6730-6759



www.afdb.org

egypt - monthly economic review - march 2014 · egypt’s foreign reserves increased slightly to...

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