Over the past 8 years, the export sectors in Egypt have developed their capabilities and supported the "Made in Egypt" slogan.

Newspaper Title: Cabinet Egypt

Newspaper Number:

Sunday - 7 May 2023

For the past 8 years, the Egyptian government has been developing its export sectors and supporting the slogan "Made in Egypt". This has resulted in an unprecedented leap in Egypt's total export value, achieved by the state's commitment to developing and implementing a comprehensive, supportive, and encouraging strategy for the export sector, which has gained particular importance in the country's economic priorities and development directions. Various production sectors have been developed, many obstacles and challenges to Egyptian exports have been removed, and the quality of Egyptian products has improved, making them more competitive in foreign markets. In addition, new markets have been opened, non-tariff barriers to Egyptian products have been removed to access global markets, and the economic cooperation and trade exchange circle with regional and international countries has been widened. This is in addition to the support of exporters and the settlement of overdue export arrears, which have reflected an increase in export rates and an improvement in the international institutions' view of Egypt's indicators in this field.

In this regard, the Media Centre of the Cabinet published a report as part of the series "Where We Were and How We Became" that sheds light, through infographics, on the unprecedented surge in Egyptian exports supported by national policies for sustainable export development over the course of 8 years of developing export sectors and promoting the "Made in Egypt" slogan, considering exports as the driving force for development and construction.

The report showed a positive change in the vision of international institutions, indicating that Fitch expects Egypt's trade deficit to decrease in the coming years due to a decrease in imports, after not expecting significant improvement in Egypt's trade deficit in 2014 and expecting slow export growth in the short term.

The report also referred to what was confirmed by the Oxford Business Group in 2021 regarding the role of structural reforms in enhancing the competitiveness of Egyptian exports and attracting investments, after announcing in 2013 a decline in sources of revenue and foreign currency such as exports and investments.

In the same context, the report mentioned what the International Monetary Fund announced in 2023 regarding the reduction of the current account deficit as a percentage of the gross domestic product, with economic recovery during 2021–2022, and a significant increase in exports of goods and services, compared to what the fund announced in 2017 about the widening of the current account deficit as a percentage of the gross domestic product in 2015–2016, due to a significant decline in exports of goods and services.

The report also discussed what The Economist announced in 2023 about Egypt's diverse exports and how liquefied gas exports to Europe will increase the value of exports in the medium term, compared to what was announced in 2013 about the widening of the trade deficit due to a significant decline in export revenues and an increase in import costs.

According to the report, Egypt's ranking in international trade indicators has improved, as it advanced 14 places in the infrastructure and market access index, ranking 82nd in 2023 compared to 96th in 2013. This index measures the quality of infrastructure that enables the flow of trade to and from international partners and is issued by the Legatum Institute, which is responsible for the annual issuance of the Global Prosperity Index, which measures a set of indicators related to growth and opportunities to promote prosperity.

Egypt also advanced nine places in the regional trade agreements index, ranking 65th in 2021 compared to 74th in 2015. This index is based on the number of valid trade agreements for goods and services and is issued by the World Economic Forum, an international organisation for cooperation between the public and private sectors in which political, commercial, cultural, and other leaders participate to shape global, regional, and industrial agendas.

The report highlighted Egypt's improvement in the trade openness index, recording 43.27% in 2019 compared to 36.92% in 2014. This index is based on the total exports and imports of a country as a percentage of the gross domestic product, and is issued by OUR WORLD IN DATA, a non-profit organization specialized in publishing research and data to make progress in addressing global problems.

The report also added that Egypt advanced 1.8 points in the trade and business index, recording 4 points in 2023 compared to 2.2 points in 2020. This index is one of the sub-indices for measuring the soft power of a country by evaluating the volume of trade with the world's countries, ease of doing business, and having a strong economy. The index is issued by Brand Finance, a consultancy and brand evaluation firm for various countries worldwide, based in London and present in more than 20 countries.

In a related context, the report showed Egypt's progress by 4 places in the value of exports worldwide, ranking 61st in 2021 compared to 65th in 2014. Egypt also ranked third in Africa in terms of the value of exports in 2021, according to Trade Map, which is a map that displays trade statistics and was developed by the International Trade Centre, a subsidiary of the United Nations Conference on Trade and Development and the World Trade Organization.

The report pointed out that Egypt was among the best countries that improved the value of exports of goods and services in 2021 compared to 2015, according to the United Nations Conference on Trade and Development.

The report revealed a significant increase in the value of exports, which amounted to $51.6 billion in 2022 compared to $43.6 billion in 2021, $29.3 billion in 2020, $30.5 billion in 2019, $29.3 billion in 2018, $26.3 billion in 2017, $22.5 billion in 2016, $22 billion in 2015, and $27.6 billion in 2014.

The report stated that the average value of exports recorded $31.4 billion from 2014 to 2022, compared to $23.3 billion from 2005 to 2013, and $4.5 billion from 1995 to 2004.

The report also highlighted a decline in the trade balance deficit as a percentage of the gross domestic product, which recorded 9.1% in 2021/2022 compared to 9.9% in 2020/2021, 9.5% in 2019/2020, 12% in 2018/2019, 14.2% in 2017/2018, 15.9% in 2016/2017, 11.5% in 2015/2016, 11.7% in 2014/2015, and 11.2% in 2013/2014.

The report also assessed the state of foreign trade during the year 2022, noting that the relative change in the value of exports was higher than the relative change in the value of imports. The value of exports increased by 87% to reach $51.6 billion compared to $27.6 billion in 2014, while the value of imports increased by 27.7% to reach $94.5 billion compared to $74 billion in 2014.

The report highlighted the most prominent goods exported in 2022 compared to 2014, indicating an increase in fuel exports by 190.5%, reaching $18.3 billion compared to $6.3 billion. Additionally, fertilizer exports increased by 312.5% to reach $3.3 billion compared to $0.8 billion, while rubber exports increased by 55.6% to reach $2.8 billion compared to $1.8 billion.

Furthermore, according to the report, exports of electrical machinery and equipment increased by 30% to reach $2.6 billion compared to $2 billion. Fruit and vegetable exports increased by 100% to reach $2.2 billion compared to $1.1 billion, while clothing and accessories exports increased by 78.6% to reach $2.5 billion compared to $1.4 billion.

The report also revealed a relative improvement in the structure of imports as a result of the decrease in the import of durable and non-durable consumer goods, in favor of increasing imports of raw materials and investment goods that are used in local manufacturing. The share of durable and non-durable consumer goods decreased to 22% in 2022, compared to 25.1% in 2014.

The share of raw materials and intermediate goods increased to 50.8% in 2022, compared to 49.9% in 2014, according to the report. The share of investment goods also increased to 12% in 2022, compared to 11.9% in 2014. Additionally, the share of fuel increased to 15.2% in 2022, compared to 13.1% in 2014.

Regarding the state's efforts to support trade exchange during the past 8 years, the report stated that initiatives to support exporters have been implemented, which target supporting exporting companies and providing sufficient cash liquidity.

The report showed that the total export support disbursed from 2013/2014 until December 2022 amounted to about 55.4 billion pounds, for more than 2,709 companies. In addition, 10 billion pounds will be disbursed during the sixth stage of the Instant Cash Payment Initiative. It is worth noting that export contracts worth $3 billion have been signed in various sectors.

Regarding the efforts to remove barriers to access international markets, the report pointed out that Egypt joined the African Continental Free Trade Agreement, the Mercosur Agreement, and began negotiating a free trade agreement with the Eurasian Union. Egypt also signed a partnership agreement with the UK, in addition to implementing the preferential Arab origin rules starting from June 2020, and accepting electronically issued certificates of origin.

In addition to the above, the report highlighted efforts to remove non-tariff barriers to facilitate access of Egyptian products to export markets, including lifting the ban on Egyptian exports of some food products, vegetables, and fruits to some major markets.

Regarding efforts to provide export and investment opportunities, the report mentioned that a number of investment opportunities have been provided in various fields worth an estimated $15 billion. Additionally, 10.9 thousand export opportunities worth $7.2 billion have been made available, along with about 2,078 foreign international tenders, and the preparation of 17.3 thousand export studies, marketing reports, and guides.

Furthermore, the report discussed efforts to provide technical support for exporters, noting that 71.3 thousand requests for promotion and commercial inquiries have been prepared to promote Egyptian exports in international markets. In addition, coordination has been made for the participation of Egyptian companies and buyer missions in 1,098 international exhibitions in Egypt and abroad.

Source : The Egyptian Cabinet 

translated by Rehab taha

Cairo Chamber of Commerce