Egypt reported a balance of payments (BOP) deficit of USD2.06bn in 2Q18/19, down from a surplus USD0.51bn a year earlier and USD0.28bn in the previous quarter, data posted by the Central Bank of Egypt (CBE) showed. (CBE).
HC’s comment: Egypt’s capital and financial account registered net inflows of USD0.23bn, down from USD4.18bn in 2Q17/18. This drop was largely due to (1) a decrease in borrowings, which decreased to USD0.61bn in 2Q18/19 from USD4.49bn a year earlier, and (2) net portfolio investment outflows of USD2.63bn compared with a net portfolio investment inflow of USD0.55bn a year earlier. Despite net foreign direct investments (FDIs) decreasing c12% y-o-y to USD1.63bn in 2Q18/19, they increased c57% compared with the previous quarter, covering c77% of the current account deficit for the same period, which widened to USD2.10bn from USD1.79bn last year. Egypt’s trade balance deficit narrowed slightly to USD9.36bn from USD9.84bn a year earlier, mainly on the back of an increase in petroleum-export proceeds to USD3.20bn in 2Q18/19 from USD2.03bn a year earlier, while petroleum imports dropped to USD2.36bn in 2Q18/19 from USD3.23bn in the previous year. The services balance recorded a surplus of USD1.21bn in 2Q18/19, up from USD0.94bn a year earlier, mainly on the back of slightly higher travel receipts, which increased some c25% y-o-y to USD2.86bn, but dropped c27% q-o-q. Net unrequited transfers decreased c15% y-o-y to USD6.05bn in 2Q18/19.
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