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Egypt country report

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Agriculture contributes around 13% of the GDP and employs about a third of the active population. …

Agriculture contributes around 13% of the GDP and employs about a third of the active population.
The warm climate and the abundant Nile water allows for several annual harvests.
The main crops are cereals, cotton, sugar cane and beets.
Egypt remains a country with little industry. With its diverse natural reserves (gold, minerals, iron, oil and gas), oil and gas-related activities and the secondary sector account for just over a third of the GDP.
Egypt is the world's sixth largest exporter of natural gas.
Egyptian tertiary sector represents around 50 % of the Egyptian GDP. It is largely dominated by revenues from telecommunications (which grew by 11% during the first quarter of 2010) and from tourism (the tourist industry brings about 11b in annual revenues. For example Cairo received 14m of visitors in 2010). 
In spite of its economy's diversification, the country still depends for a large part of its income
on the Suez Canal (380m during the first quarter of 2010). 

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  • 1. Main Industry SectorsEconomic OverviewForeign Direct Investment [FDI]FDI Government MeasuresCountry Strong PointsCountry Weak PointsForeign Trade Overview
  • 2. Agriculture contributes around 13% of the GDP and employs about a third of the active population. The warm climate and the abundant Nile water allows for several annual harvests. The main crops are cereals, cotton, sugar cane and beets. Egypt remains a country with little industry. With its diverse natural reserves (gold, minerals, iron, oiland gas), oil and gas-related activities and the secondary sector account for just over a third of the GDP. Egypt is the worlds sixth largest exporter of natural gas. Egyptian tertiary sector represents around 50 % of the Egyptian GDP. It is largely dominated byrevenues from telecommunications (which grew by 11% during the first quarter of 2010) and fromtourism (the tourist industry brings about 11b in annual revenues. For example Cairo received 14m ofvisitors in 2010). In spite of its economys diversification, the country still depends for a large part of its income on the Suez Canal (380m during the first quarter of 2010).
  • 3. Establishment of a new Egyptian government in July 2004, Egypt launched an economicreforms program, including a large stimulus plan in 2008.Consequently, tariffs and taxes were lowered and simplified.The transparency of the national budget was reinforced and many privatizations wereinitiated.This new policy bore its fruits as growth reached a level of more than 5% in 2009 and2010, especially thanks to the resumption of private and public consumption.The construction, communications, wholesale and retail sectors, catering andhospitality, as well as manufacturing contributed to the development of economicgrowth.The year 2010 was marked by an under-performance of the sectors which most stronglycontribute to the countrys GDP, namely agriculture and mining.The IMF growth estimates for 2011 are between 5.5% and 5.8%, counting on theincrease in consumption, recovery of foreign growth (tourism and the Suez Canal) and aresumption of investments.
  • 4. Egyptian economy has entered into a cycle of progressive growth, its level of growthremains insufficient to maintain employment and reduce the share of population livingbelow the poverty of line (18%).Egypt faces a high rate of inflation (about 10%). Foreign accounts, weakened during thecrisis by a decline in foreign exchange earnings and net capital flows, have recovered andthe trade balance returned to surplus in 2010.
  • 5. With the rapid influx of new investments since 2005, Egypt became the first recipient of FDIs in theMiddle East, and 3rd in the Arab world after Saudi Arabia and United Arab Emirates. The dynamic growth of the Egyptian economy (around 7% in the recent years), the strategic geographicalposition of the country, its low labor costs and skilled workforce, a unique tourist potential, substantialenergy reserves, large domestic market and the success of reforms undertaken by the authorities since 2004(including many privatizations) are all factors that may explain the sharp rise of FDI. The regional context should also be taken into account, as Egypt has benefited from abundant liquiditycoming from the Gulf countries, as a direct result of the increase in revenues generated by oil exports.
  • 6. Due economic crisis, FDI flows, which had been slowing down since the summer of 2008, halved in thetwo last years: a decrease in 40% in 2008-2009, with 8.1 billion dollars and a decrease of 17% in 2009-2010, with 6.8 billion dollars. FDI comes mainly from the European Union, the United States and the Arab countries. The United States,for a long time the number one investor in Egypt, have now been exceeded by the European Union. Investments focus primarily on tourism, construction, telecommunications, financial services, energy,and healthcare.
  • 7. Since September 2004, the General Authority for Investment and Free Zones (GAFI) hasestablished an economic program to attract foreign investors, together with an averagereduction of 35% customs duty and tariff simplification. Though all the economic sectors are open to domestic and foreign investors, there aresome that are especially targeted by the Law, which expressly provides the possibility toexecute projects under the BOT (Build, Operate, Transfer) form, in theagricultural, industry, mining, tourism and hospitality, air travel, off-shore shippingtransport, goods transport services, oil prospection and drilling, infrastructures morespecifically for drinking water conveyance, roads, housing and used water recycling sectors. Other sectors are added to this list depending on needs (leasing, venture capital, creationof computer programs and software, etc.). Privatization programs are also open to foreign investors. Some sectors are consideredstrategic and hence subject to specific legislations: aerospatial, defence, newspaperpublishing.
  • 8. Egypt is in a geographically strategic location. Egypt offers a cheap and relatively qualified labor force. Egypt growing population constitutes a non-negligeble market in the region. Egypt energy resources are attractive and in addition, the country has in recent years, launched a publicworks policy (construction of the third metro line, expansion of the port of Sokhna and improvement andrenovation of the rail network), which offers many investment opportunities to foreign companies. Egyptian government policy for large scale liberalization and improving the appeal to foreign investors are encouraging signs for foreign investment.
  • 9. Despite privatizations, the inefficient and loss-making public sector remains ubiquitous in somesectors. Egyptian apid population growth continues to curtail the improvement of the standard of living forEgyptians. Egypt registers a delay in its infrastructures in which current investments are not able to make upfor.
  • 10. The Egyptian market is gradually opening up, especially after signing an agreement withthe European Free Trade Association (EFTA) in 2006, and a free trade treaty with the UnitedStates. Egypt three primary export partners are the European Union, which represents more than athird of the trade, United States and Syria. The EU and the USA absorb almost 60% of Egyptian exports. Egypt mainly exports mineral fuels and oil, cotton, iron and steel. Egypt imports mainly consumer electronic goods and capital goods, nuclear reactors andnuclear-powered boilers, cereals, food products and chemical products. Import volume has doubled and is twice the export volume, a fact which contributed to thedeterioration of the countrys trade balance, now a deficit (USD 25.1b in 2010)
  • 11. Visit us to download for related reportsMarket Opportunities of products and Services in Egypt.Export and investment sector opportunities in Egypt.Overview of Trade Regulations, Customs and Standards Egypt.Egypt Investment guide for beginners.Business and Project Financing in Egypt.Business Travel Advisory in Egypt.
  • 12.  China  Australia Mexico  Germany United States  France India  Spain Canada  South Korea Russia  Vietnam Hong Kong  Saudi Arabia Colombia  Poland Brazil  South Africa Turkey  Nigeria Indonesia  Argentina Egypt  UAE Singapore  Netherland United Kingdom  Sweden Italy  Thailand Japan  Israel and more…. Buy 2 reports get 1 report FREE
  • 13. International Market Research Report on 300+ topics over 100 countries Instant online Delivery Need additional reports ? Market Share Distribution and business practices Market Size Statistical data Market Trends End user analysis Market access Import and Export strategies information Market Analysis Competitions Domestic production Best sales prospects Tariffs and Trade shows and regulations contact points
  • 14. Thanking for downloading For more information visit uswww.worldresearchreport.com Or Email usworldresearchreport@gmail.com

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