Egypt’s Current Account Deficit Decreases After Increase in Revenues
The Central Bank of Egypt announced on Tuesday that the country’s current account deficit has decreased to $5.3 billion in the period from July 2022 to March 2023, compared to $13.6 billion in the same period of the previous fiscal year. This decrease was driven by a significant increase in tourism revenues and toll fees in the Suez Canal.
Remittances from Egyptians abroad also declined by 26.1% to $17.5 billion, compared to $23.6 billion in the same period of the previous fiscal year. Bankers have stated that a majority of Egyptians abroad have been making transfers through the unofficial market, as the country faces a severe foreign currency crisis that has caused the Egyptian pound to lose half of its value against the dollar.
The Egyptian pound has significantly depreciated against the dollar
Tourism revenues reached $10.3 billion, a 25.7% increase compared to the same period in the previous fiscal year, while toll fees in the Suez Canal recorded $6.2 billion, compared to $5.1 billion in the same period of the previous fiscal year.
The Central Bank pointed out that
How has the decline in remittances from Egyptians living abroad affected Egypt’s current account deficit and what are the reasons behind this decline
Egypt’s current account deficit has seen a significant decrease, falling to $5.3 billion between July 2022 and March 2023. This marks a sharp decline from the $13.6 billion deficit recorded in the same period of the previous fiscal year. The reduction in the deficit can be attributed to a notable increase in both tourism revenues and toll fees from the Suez Canal.
Tourism revenues saw a substantial boost, reaching $10.3 billion during this period. This represents a 25.7% increase compared to the previous fiscal year. Additionally, toll fees generated from the Suez Canal amounted to $6.2 billion, surpassing the $5.1 billion recorded in the same period last year.
However, it is worth noting that remittances from Egyptians living abroad experienced a decline of 26.1%, falling to $17.5 billion. This drop can be partly attributed to the country’s foreign currency crisis, which has led many Egyptians to make transfers through the unofficial market due to the significant depreciation of the Egyptian pound against the dollar.
Overall, the decrease in the current account deficit is a positive development for Egypt’s economy, as it signifies an improvement in the country’s financial position. With the tourism sector showing promising signs of recovery and the Suez Canal continuing to generate substantial revenue, Egypt is hopeful for a more stable economic future.
This article highlights positive developments for Egypt’s economy as it sees a decline in current account deficit, coupled with an increase in tourism and Suez Canal revenues. These trends indicate a promising future for the country’s economic growth and stability.