Egypt: Balance of Payments in Deficit

Oil exports are in free fall, Suez Canal revenues plummeting

Egypt’s monetary authorities have summarized the first half of the current fiscal year (July 2023 – June 2024) and recorded a balance of payments deficit of more than $410 million. According to data released by the Central Bank of Egypt (CBE), remittances from Egyptians working abroad fell by 21% during the period, dropping from $11.9 billion in the second half of 2022 to $9.44 billion in the same period of 2023.

A sharp drop was recorded in the North African country’s oil export revenues, which amounted to $3.3 billion from July to December 2023, compared to $8.7 billion in the corresponding period of 2022. On the other hand, Egypt’s non-oil exports increased from July to December 2023, rising to $13.2 billion compared to $12.9 billion in the corresponding previous period.

Egypt’s tourism industry is recovering from the covid pandemic, with tourism revenues from July to December 2023 totaling about $7.8 billion, up from $7.3 billion in the same period in 2022. Before the Red Sea crisis caused by Yemeni Houthi attacks on merchant ships, Suez Canal revenues totaled more than $4.8 billion between July and December 2023, compared to $3.98 billion in the second half of 2022. Instead, between December and March 2024, the flow of money generated by maritime transportation through the Suez Canal declined by about 50 percent. Finally, net foreign direct investment (FDI) declined slightly, falling from $5.73 billion (second half of 2022) to $5.53 billion in the second half of 2023.