Egypt a prime market for UAE businesses

Egypt is undergoing a stage of economic transformation. Analysts say that the economy of Egypt still faces challenges to its improvement and the work of the government comes from a weak starting point. However, the country is seen as a market for UAE companies within multiple industries.

“The sovereign rating of B3 currently carries a stable outlook because we see that the credit challenges and the credit strengths are balanced. We see gradual improvement in the government finances but the deficit is very large. At the same time the government debt level remains high,” said Steffen Dyck, senior analyst at Moody, the international finance corporation for credit ratings.

Steffen explained that the Suez Canal receipts have shown a very strong correlation with global trade, and based on this correlation, world trade would have to grow by around 10 per cent per year between 2016 and 2023 to achieve the projected $13 billion (Dh47.7 billion) in annual revenues. “Under more conservative scenarios of trade growth and assuming no material change in the current toll structure, Suez Canal receipts would grow at a much slower pace, thereby limiting the positive effects on Egypt’s external payments position. For instance, between 1992 and May 2015, average growth in world trade was only around 2 per cent per year.”