Egypt's Current Account Deficit Skyrockets to $17.1 Billion in Fiscal 2023/24, Central Bank Reports
In a shocking revelation, Egypt's current account deficit has surged to an alarming $17.1 billion in the first nine months of fiscal 2023/24, a stark increase from $5.3 billion in the previous year. This drastic change has been attributed to a significant drop in oil exports, plummeting by $7.2 billion to a mere $4.6 billion.
On the flip side, imports of oil products have risen by $1.5 billion, alongside a $268.2 million increase in imports of other goods. These shifts come as Egypt grapples with power shortages exacerbated by a scorching heatwave driving up demand for cooling.
Furthermore, Suez Canal revenues have taken a hit, declining to $5.8 billion in the July-March period compared to $6.2 billion in the same period a year earlier. The most significant drop was witnessed in the Jan-March 2024 period, with revenues plummeting by 57.2 percent to a mere $959.3 million.
The central bank attributed this decline to disruptions in Red Sea maritime traffic, leading several commercial shipping companies to divert their routes. The Iran-backed Houthis' attacks on vessels in the Red Sea region have further exacerbated the situation, claiming solidarity with Palestinians in the Israel-Hamas conflict in Gaza.
Despite these challenges, Egypt has seen a positive trend in net foreign direct investments, which have tripled to $23.7 billion from $7.9 billion in the same period a year earlier. However, remittances from Egyptian workers abroad have decreased to $14.5 billion from $17.5 billion, while tourism revenues have experienced a slight uptick to $10.9 billion from $10.3 billion.
As Egypt's fiscal year draws to a close on June 30, these economic indicators paint a complex picture of the country's financial landscape. It is crucial for investors and individuals alike to monitor these developments closely to make informed decisions about their finances and investments.