CAIRO: The disclosure of the reasons behind the decline in non-petroleum Egyptian exports during the first five months of 2015 by 20% compared to the same period in 2014 is not only dependent upon official statements.
Minister of Trade, Industry and Small Industries Mounir Fakhry Abdel Nour on May 2 said that, “The decline in Egyptian exports is linked to security problems and the fluctuating political situation in the Arab countries.”
Yasser Jaber, spokesman for the ministry, told Al-Monitor that there is a global trade recession, and the relative deterioration in the Gulf Cooperation Council economy, following the fall of world oil prices, has caused them to reduce their imports of Egyptian products.
The Trade Map website, which includes the largest database for international trade, recorded in early 2014 a decline in the importation rates of three Gulf States in 2013. Saudi Arabia saw a decline in imports by 6.75%, while the United Arab Emirates and Oman’s decline stood at 2.92% and 14.7%, respectively. The website also highlighted the decline of Oman’s import rates from Egypt in 2014 by 11.6% compared to 2013. However, the website has yet to display any statistics on the Gulf imports from Egypt, particularly in 2015.
According to Abdel Nour, the political, security and economic vagaries in the Arab countries, including the Gulf, are not the main reason behind the decline in Egyptian exports. This is because the Arab countries are not the top importer from Egypt. Rather, Europe and the United States come first.
Trade Map says that the decline in Egypt exports has been an almost yearly phenomenon since 2012, when the total non-petroleum exports in Egypt were at $21 billion, compared to $22.3 billion in 2011, despite the insecurity at the outset of the Arab Spring in 2011 in most of the Arab countries.
According to Trade Map, in 2013, Egypt’s petroleum and non-petroleum exports declined by 3.4%. Non-petroleum exports also declined in 2014 by 4.8%, reaching about $20 billion compared to $21 billion in 2013.
Rihan Mohammed, vice president of the Egyptian International Trade Point, which is a subsector of the Ministry of Trade, Industry and Small Industries, told Al-Monitor that the promotion and transfer of the Egyptian product is deteriorating, due to neglect on the part of the government in state institutions following the January 25 Revolution. Mohammed added that there is a deterioration in the land, sea and air trade transportation lines between Egypt and world countries, which has led to the delayed exportation of Egyptian goods and caused damage to some, particularly food products.
Since late 2014, Egypt has been witnessing a crisis in terms of the availability of natural gas and fuel, upon which the majority of the factories rely. This shortage has obstructed production. Raw materials consist of only 8% of Egypt’s exports. The fuel crisis of 2014-15 has hindered factories’ activities, which produce a large part of Egyptian exports. Farag Abdel Fattah, economics professor at the Faculty of Economics and Political Science at Cairo University, agreed with Mohammed and Jaber, who considered the decline in factory performance the main reason for the decline in exports. For instance, some fertilizer factories have completely halted their activities at a time when fertilizers are considered Egypt’s most important exports.