Egypt’s trade deficit registered approximately EGP 29.7bn as of June, compared to EGP 35.2bn in June 2015, a decline of 15.7%, according to the Central Agency for Public Mobilisation and Statistics (CAPMAS).
In its monthly bulletin on foreign trade issued on Wednesday, CAPMAS said that the value of the Egyptian exports increased by 15.9% in June, registering EGP 17.1bn compared to EGP 14.8bn in June 2015.
The increase in the value of exports in June is owing to the increase in the value of some products, such as fertilisers, furniture, soap, and cleaning products, according to CAPMAS.
“The export rate of some products declined in June 2016 compared to June 2015, most important of which are crude oil by 6.1%, fresh fruits by 7%, oil products by 21.7%, and ready-to-wear clothing by 7.8%,” said CAPMAS.
CAPMAS noted that the value of imports decreased by 6.3% in June, recording EGP 46.8bn compared to EGP 50bn in June 2015. This was due to the decline in the value of some imports, such as oil products, iron and steel raw materials, and milk and dairy products. The value of certain imports did increase in June compared to June 2015, such as medicines, meat, and plastic in primary forms, according to CAPMAS.
According to Ezz El-Din Hassanein, expert on banking and economics and chairperson of a bank operating in Egypt, the decline in Egyptian imports over the past few months is due to the increase in the US dollar exchange rate against the national currency. Moreover, the Central Bank of Egypt has left the US dollar price on the unofficial market up to supply and demand, amid the shortage of foreign reserves in banks.
This situation sharply increased costs for importers, which pushed many traders to reduce their imports. Hassanein noted that there has been an abrupt decline in the total local demand and this will lead to a reduction in growth rates and local production.