For the sixth year in a row, the value of Egyptian non-oil exports did not bear anything new, and remained between 20 and 25 billion dollars. It was unable to break this barrier despite the positive results of the economic data issued by the government.
Despite measures to rationalize spending, limit imports from abroad, and praise international financial institutions, Egyptian imports (between $ 63 and 71 billion) have maintained a large difference between them and exports, and thus the trade deficit continued between $ 40 and $ 46 billion.
The volume of Egyptian exports remains modest and economically and politically worrisome in the eyes of many financial and economic experts who spoke to Al Jazeera Net, and it does not keep pace with what the government announces in terms of economic progress and success and its high growth rates, which indicates a defect in one of the most important economic indicators for emerging countries.
Here, questions arise, such as: Why have Egyptian governments been unable over the past years to increase the ceiling for exports (non-oil) and to cross the barrier of $ 25 billion?
And why did the devaluation of the pound not succeed - after the decision to float in 2016 - in increasing exports, as officials promoted at the time?
Bright economic numbers
Egypt achieved economic growth of 3.6% in the fiscal year 2019/2020, and the annual average rate of inflation decreased to 5.7% in the same period, and the size of the gross domestic product (at current prices) during the same period rose to 5.5 trillion pounds (one dollar equals 15.75 pounds).
Observers also questioned the role of large projects during the period from 2014 to 2020, which exceeded 14 thousand projects, at an estimated cost of about $ 140 billion, according to a volume issued by the Egyptian government under the title "6 Years Harvest" (2014-2020).
In its new statement, the Ministry of Trade and Industry celebrated its success in reducing the trade balance deficit during 2020 by 17%, as the deficit amounted to $ 38.2 billion, compared to $ 46.2 billion in 2019.
The value of exports reached $ 25.2 billion in 2020, compared to $ 25.6 billion in 2019, while imports reached $ 63.5 billion in 2020, compared to $ 71.8 billion in 2019.
In the course of his analysis, the financial market expert, Dr. Wael Al-Nahhas said that "despite the state's great efforts to increase the volume of exports, there are obstacles that prevent this from being related to several things, such as the high cost, which is an essential element, as the raw materials that enter the production operating lists have a high cost," Imported, and strains Egypt's ability to compete. "
Speaking to Al-Jazeera Net, Al-Nahas added that Egyptian exports suffer from the absence of open international markets, due to the quality and quality of the exported materials, and the presence of major competitors with lower quality and cost.
He pointed out that there are other factors that increase the cost of the product, such as high electricity and energy prices, which affected many exports such as fertilizers and ceramics, and the high cost of transportation.
Regarding the absence of the effect of the pound’s depreciation against the dollar due to the flotation, Al-Nahas confirmed that the officials ’speech at the time that reducing the pound would save exports and double their size was for domestic consumption, and said that this matter would have been beneficial if Egypt was a producing and exporting country.
The economist called for the need to protect producers and exporters from the fluctuations of economic decisions, pointing out that the matter needs to develop clear and stable economic policies, but what happens is that there are permanent changes that prevent tangible and real increases in exports.
Enterprise and debt syndrome
For his part, political economist Mustafa Youssef attributed the volume of exports of a country like Egypt to “the absence and lack of political vision, and the lack of political will for development, because any real economic development necessarily leads to an increase in exports and a reduction in poverty rates, but what we see is the waste of the country's resources and borrowing. Increasingly to finance projects that are not economically viable. "
In statements to Al-Jazeera Net, Youssef warned of the results of this imbalance on the independence of the political decision as a result of the modest volume of exports on the one hand, and the increase in imports on the other hand, which makes it subject to political fluctuations in the region and the world, indicating that an exit from this "dilemma" is not possible in light of the situation. Current.
He stressed that the official poverty rates, which amount to about 30%, cannot be separated, in addition to the deterioration of the economic and living conditions of about two-thirds of the Egyptian people from the futility of all the numbers and projects that the government constantly announces.
The dilemma of not increasing exports, along with the crisis of high external debt, remains one of the negative syndromes of the Egyptian economy for years, as Central Bank data showed that the total external debt rose to about $ 125.3 billion at the end of last September.