Building Egypt’s economic front has been successful in setting the foundations for a dynamic economy. With positive indicators that mark our leaps and progress in establishing these foundations, Unemployment rates falling, strategies and financing for developing the Micro, small and medium enterprises (MSMEs) mechanism set in place, a continued success in clearing the country’s built up debts and dues, the country’s foreign capital and remittances inflow on the rise, legislations and foreign exchange flexibility in the market for attracting investments in focus and remarkable growth and development rates over the past year and forecasts for better achievements over the coming year.
Egypt’s unemployment rate dropped to 10.6 percent in the first quarter of the year, down from 12 percent a year earlier, state statistics agency CAPMAS said on Tuesday. Reuters reported that the rate has been steadily dropping in recent months amid a programme of economic reforms. President Abdel Fattah El-Sisi has promised to cut the rate to 10 percent over the next few years, a target that will require higher levels of economic growth.
Foreign currency inflows to banks operating in Egypt have risen to more than $120 billion since the flotation of the Egyptian currency in November 2016, Central Bank of Egypt (CBE) Governor Tarek Amer said. Amer announced targeting to pump 30 billion Egyptian pounds ($1.68 billion) in small enterprises to benefit 8-10 million citizens, adding that around 10 billion is going to facilitate medium enterprises.
He added that Egypt will pay off $850 million in arrears owed to international oil companies operating in the country, governor, it is to be noted that Egypt owed the foreign oil companies around $2.4 billion at the end of June 2017. Remittances from Egyptian expatriates increased by 11.6 percent, recording $2 billion during February 2018, according to a recent statement by Central Bank of Egypt on Monday. Earlier, remittances stood at $1.8 billion in February 2017, the statement added. The CBE had previously announced that total remittances from expatriates rose by 24.1 percent, or $3.4 billion in the July-February period of financial year 2017/2018 to $17.3 billion from $13.9 billion in the year-ago period.
Egypt’s foreign reserves reached $44.03 billion in April 2018 for the first time in history, compared to $42.61 billion at the end of March. The current average of foreign reserves covers about eight months of Egypt’s commodity imports, which is higher than the global average of about three months of commodity imports. The reserves are expected to further grow over the coming two years to reach $50 billion, banking sources said last week backed by tourism revenues, Egypt’s Eurobonds issuance, foreign direct investments and the savings from natural gas imports. “We enabled to attract around $25 billion from treasury bills and around $10 billion from the Egyptian Exchange (EGX), to raise the total foreign investments to $35 billion,” Amer said.
He pointed to the availability of liquidity necessary to finance projects, reaching all levels of society through financing small and medium enterprises. Egypt’s domestic liquidity surged by 21.8 percent, recording 3.34 trillion Egyptian pounds ($188.5 billion) at the end of March 2018 from 2.7 trillion pounds a year earlier, said Central Bank of Egypt (CBE) on Monday. On a monthly basis, liquidity rose by 1.5 percent last March from 3.29 trillion pounds in February, CBE further referred.
Amer said earlier that all restrictions on foreign exchange in Egypt have been canceled, clarifying that investors now can manage their financial situations and get the foreign currency they want.
Egypt recorded the highest GDP among developing countries, ranking number six or seven in Morgan Stanley’s index for growth after China, Malaysia and India, he added.
Such a a ripe stage in the country’s economic progress calls for marketing and legislative mechanisms to promote youth engagement in the process of utilizing capital set for SMEs development, on the grounds of legislation’s, young women and men need a promotional campaign for achieving their business ideas with proper incentives set forth by a 5 year tax exemption, and a transparent simple process in applying for a business loan. On the grounds of marketing SMEs packages should be promoted at Universities, Youth Centers and youth gathering spots to generate a high level of awareness within their targeted market and audience as a step towards encouraging youth integration into the economy.