News

Egypt Lowers Economic Growth Forecast as Tourism Revenues Decline

Egypt Lowers Economic Growth Forecast as Tourism Revenues Decline

picture-of-Sharm-el-Sheikh-beach

Egypt lowered its economic growth forecast for the current fiscal year from an earlier estimate of 5 percent to a range of 4 to 4.25 percent, Finance Minister Hany Kadry Dimian said.

The modification of the growth forecast seems primarily to have resulted from the recent plummeting of tourism revenues following the downing of a Russian passenger jet near the Red Sea resort of Sharm el-Sheikh last year.

“Tourism is one of the major sectors, not just as a driver of growth and one of the biggest sources of current-account receipts but because it has a higher multiplier impact on other industries,” Bloomberg quoted Dimian as saying.

Since the 2011 uprising that toppled President Hosni Mubarak, Egypt has struggled with getting the economy back on its feet. The falling tourism revenues have been amplified by the dwindling foreign currency reserves that have negatively affected some companies and the budget deficit, which the Finance Minister estimated is between 11 and 11.5 percent of GDP.

In an effort to bridge the budget gap and improve the general state of the economy, the Arab world’s most populous country has had to rely on grants and loans from Gulf states which have pumped in billions of dollars into the Egyptian economy, especially since the ouster of former president Mohamed Morsi.

However, Dimian maintained that the Gulf states are now shifting from grants to investments, since the rate of return is generally higher from the latter.

“What we are focusing on now is how to foster direct investments from the Gulf states,” he was quoted as saying.

Egypt has been working to implement reform measures to stimulate growth, increase revenues and deal with the foreign currency dearth.

In 2014, Egypt cut fuel subsidies, leading to sharp price increases, and introduced a property tax to bridge the budget deficit. The newly elected parliament is also expected to discuss a value-added tax soon.

In an effort to alleviate the current dollar shortage, which has led to imports of essential goods languishing at customs, Egypt’s central bank last week raised the ceiling on foreign currency deposits for exporters to USD 1 million a month.

Sisi Calls for National Unity, Urges Egyptians to Listen to Him 'Only'
Bridge Collapse in Alexandria Leaves 3 Dead

Subscribe to our newsletter


News

More in News

Egyptian MP Drafts New Law to Regulate Outdoor Advertising

Nour EltiganiNovember 19, 2018

Naguib Mahfouz’s Newly Discovered Stories to be Published This December

Mirna AbdulaalNovember 19, 2018

Egypt’s Unemployment Rate Down to 10 Percent in Q3 of 2018

Egyptian StreetsNovember 16, 2018

Egypt ‘Appreciates’ and ‘Trusts’ Final Saudi Investigation into Khashoggi Killing

Egyptian StreetsNovember 16, 2018

Archaeological Mission Unearths Ancient Pregnant Woman Burial

Egyptian StreetsNovember 14, 2018

Egyptian MP to Submit Bill Omitting Religion from National IDs to Parliament

Egyptian StreetsNovember 12, 2018

British Parliament Encourages Lifting the Travel Ban Imposed on Sharm El Sheikh

Nour EltiganiNovember 11, 2018

Egyptian Film ‘Yomeddine’ Wins at Geneva Film Festival

Mirna AbdulaalNovember 10, 2018
Egyptian Streets is an independent, young, and grass roots news media organization aimed at providing readers with an alternate depiction of events that occur on Egyptian and Middle Eastern streets, and to establish an engaging social platform for readers to discover and discuss the various issues that impact the region.

© 2017 Egyptian Streets. All Rights Reserved.