EGYPT: Government hopes that 2010 and 2011 will bring economic growth
The Egyptian government is expecting growth rates to rise to 6% during the coming fiscal year, after rates tumbled to 4% last year during the global financial crisis.
During the World Economic Forum sessions in Davos, Switzerland, minister of trade Rachid Mohamed Rachid said that while the road to full recovery from the economic turmoil would be difficult, pre-crisis growth rates should be reached during the fiscal year that begins July 1.
"We want 5% growth this year. Starting the next year, we can have momentum enough to get to 6%-plus, which will put Egypt back on foreign investors' maps and create a country where investments would flourish," Rachid said.
The minister stressed that despite repercussions of the global crisis that negatively affected the country's top foreign currency earners, focusing efforts on internal trade had been crucial in reaching an 'impressive' 4% growth rate in 2009.
"Local market activity is quite positive, especially in the area of construction that has an impact on consumption, employment and manufacturing," he said.
Tourism, Suez Canal revenues and remittances from abroad are Egypt's three main sources of foreign currency. These were all hampered during the first half of 2009, but figures announced by the Egyptian Information and Decision Support Centee showed notable improvements in the second half of the year. Revenues from the Suez Canal, for example, reached $389.7 million in December, an increase of 6.6% compared with the previous month.
Rachid's predictions come as a report issued by Merrill Lynch & Co. -- one of the world's leading financial management and advisory companies -- listed Egypt among the top 10 countries whose economies were not severely damaged by the global financial crisis. The problem for millions of Egyptians, however, is that economic growth has not trickled down to the working class. More than 40% of Egyptians live on $2 a day or less and barely keep pace with inflation.
-- Amro Hassan in Cairo
Photo: Egyptian trade minister Rachid Mohamed Rachid. Credit: Associated Press