Egypt’s current account deficit soars in first quarter

Egypt’s current account deficit more than doubled to $4 billion in the first quarter of its financial year as tourism revenues plunged, the Central Bank said on Wednesday.

The deficit was $1.6 billion in the same period a year earlier, the central bank said in a statement.

The 2015/16 fiscal year started in July.

The overall balance of payments deficit reached $3.7 billion in July-September, compared with a surplus of $410 million in the same quarter a year earlier.

The widening current account deficit was driven partly by a decline in the services surplus, which narrowed by 22.6 per cent to $1.7 billion.

“This figure is largely traced to the fall in services and income receipts, especially tourism revenues which fell by 17.5 per cent, to register $1.7 billion,” the central bank said.

Another factor was a decline in net unrequited transfers to $4.3 billion from $6.2 billion in the same period a year before due to a plunge in net official transfers.

Net official transfers fell to $21.9 million in the first quarter from $1.5 billion in the same period a year earlier.

The trade deficit registered $10 billion, unchanged from the same period a year earlier, the central bank said.

Net inflows of foreign direct investments rose, however, to $1.4 billion from $1.3 billion.

External liabilities of the central bank dropped to $1.2 million from $1.3 million in the same quarter a year earlier, the central bank data showed.