EGYPT’S current account deficit narrowed to $2.1 billion in January to March 2025 from $7.5 billion in the same period a year earlier, the central bank said on July 22. The central bank attributed the slimmer deficit to the increase in remittances from Egyptians working abroad, as well as a rise in the services surplus due to higher tourism revenue, Reuters reported. Oil exports declined to $1.2 billion, from $1.4 in the year earlier, while imports of oil products rose to $4.8 from $3.4 billion.
Egypt has sought to import more fuel oil and liquefied natural gas this year to meet its power demands after disruptions to gas supply led to blackouts over the last two years.
Concerns over supplies increased after the pipeline supply of natural gas from Israel to Egypt decreased during Israel’s air war with Iran last month. Revenues from the Suez Canal declined to $0.8 billion in the third quarter of the country’s financial year, from $1 billion the same time a year ago, as Yemeni Houthis’ attacks on ships in the Red Sea continued to cause disruption.
The Iran-aligned group says it attacks ships linked to Israel in support of Palestinians in Gaza. Meanwhile, Egypt’s tourism revenues reached $3.8 billion, compared to $3.1 billion in the same period in 2023/24. Remittances from Egyptians working abroad increased to $9.3 billion, from $5.1 billion. The increase in remittances has helped to reduce the wider trade deficit.
Foreign direct investment hit $3.8 billion, compared to $18.2 billion in the same quarter a year before. Egypt has suffered an economic crisis exacerbated by a foreign currency shortage, which forced it to undergo economic reforms under an $8 billion IMF programme that included allowing its pound to depreciate sharply last year.
