Egypt Tops Portfolio Investment Flows in Emerging Markets

In a statement to the ministry of Finance on Friday, Mohamed Maait said that Egypt has become the most attractive in terms of the flows of portfolio investments in the emerging world during the year 2020.

According to the Deutsche Bank report, Egypt occupied the fifth biggest concentration of foreigner investments, and the third largest decline in interest rates.

The Egyptian Minister noted that most international agencies praise the sustainable development of the Egyptian economy, which opened up broad prospects for attracting foreign investments especially in portfolio investments that have received an increasing demand and registered a new global certificate of confidence.

The minister indicated that the new indicators included in the report reflects the success of the economic reform program in creating an environment for doing business, raising the efficiency of the state's public finances, reducing debt, deficit and inflation rates, in addition to improving the performance of the Egyptian pound against other currencies.

The Minister added that the coming period will witness a stimulation in the private sector to help adopt a comprehensive development process, in order to achieve sustainable growth that is based on production, export and investment, and creates more job opportunities, as well as contributions to improving the services provided to citizens and granting them a decent life.

He pointed out that the government is continuing its plan towards achieving financial and economic targets in a manner that appeared clear in the indicators of the performance of the general budget during the period from July to December of the current fiscal year.

"This was reflected in the future outlook of of the Deutsche Bank," he noted, adding that the bank expected a growth rate of to 5.8% during the current fiscal year, and 5.9% during the next one, while the government aims to have a growth rate of 6 percent of GDP in FY 2020/21.

He pointed out that the economic reforms implemented by the government with strong support from the political leadership pushed Egypt to occupy second spot at the level of emerging countries in the government budget balance after converting the deficit rate to an initial surplus of 2% of GDP, and the first at the level of emerging countries in debt relief.

The minister stated that Egypt had succeeded in reducing the debt of the public budget apparatus to the GDP by about 18% in just two years, to reach the ratio of about 90%, and it is expected to reduce it further to 83% in June 2020.

The Deutsche Bank report had expected an improvement in the current account deficit and a drop of 2% of during the next year compared to 3.6% during the last fiscal year, due to the improvement in the petroleum trade balance against the background of low import volume and self-sufficiency in natural gas, as well as improved security conditions and tourism.

The report indicated that the country's huge infrastructure and foreign direct investment flows directed to developing gas and oil fields, building the new administrative capital and developing the Suez Canal and the surrounding industrial area will be characterized by supporting the growth of capital accumulation at rates above 10%.