In line with our expectations, the effect of COVID-19 on Egypt’s external balance drove the CAD deficit to double y/y to USD2.8bn in Q1 FY21. The trade deficit inched up by 0.9% y/y, despite a 12% y/y fall in exports, which was partially offset by a 7% drop in imports. Meanwhile, the service surplus (mainly tourism) remained under the pressures of pandemic-related headwinds, posting another plunge in Q1 FY21 (-78% y/y). Workers’ remittances are still a bright spot for Egypt’s external position, growing 20% y/y in Q1 FY21.
Mona Bedeir
Senior Economist
T +202 3300 5722