Economics of Egypt Report

Economics of Egypt Report

Item

2006

2011

2016

Comment

Reference(s)

GDP (billion $)

107.5

236.0

331

a relatively low GDP

Egypt, Arab Rep., 2016

Egypt | Economic Indicators, 2016

GDP per Capita ($)

1,330

2,590

2707

low value

Egypt, Arab Rep., 2016

Egypt | Economic Indicators, 2016

Population (millions)

76.27

83.79

83.4

high population

Egypt, Arab Rep., 2016

Egypt | Economic Indicators, 2016

Population Growth (%)

1.76

2.11

n/a

low growth rate

Egypt, Arab Rep., 2016

GINI Coefficient (Score/Rank)

34.4/111

32.1/113

n/a for 2016 yet

medium inequality country

UNDP (2006);

UNDP (2011)

Annual inflation (%)

7.64

10.05

12.02

low value of inflation

Egypt, Arab Rep., 2016

Egypt Inflation Rate, 2016

Unemployment (%)

10.6

12

12.6

above the generally accepted number - 6%

Egypt, Arab Rep., 2016

Egypt Unemployment Rate, 2016

TIs CPI (Score/Rank)

3.3/70

2.9/112

n/a for 2016 yet

highly corrupted; situation got worse over years

Transparency International 2006

Transparency International 2011

Exchange Rate (USD/EGP)

5.74

5.94

9.45

Yearly Average Rates, 2016

Trade (Imports/Exports) (million USD)

20,594/13,720

62,282/31,582

71,337/26.812

Over the reviewed period, imports increased by 3.5 times, while exports grew by almost 200%

Egypt, Arab Rep..Trade Summary, n.d.

Egypt Imports, n.d.

 

References

Egypt, Arab rep. (2016). Retrieved from http://data.worldbank.org/country/egypt-arab-rep?view=chart

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Egypt, Arab rep. Trade summary. (n.d.). Retrieved from http://wits.worldbank.org/CountryProfile/en/Country/EGY/Year/2006/Summary

Egypt, Arab rep. Trade summary. (n.d.). Retrieved from http://wits.worldbank.org/CountryProfile/en/Country/EGY/Year/2011/Summary

Egypt | Economic indicators. (2016, October 12). Retrieved from http://www.tradingeconomics.com/egypt/indicators

Egypt imports. (n.d.). Retrieved December 12, 2016, from http://www.tradingeconomics.com/egypt/imports

Egypt inflation rate. (2016). Retrieved from http://www.tradingeconomics.com/egypt/inflation-cpi

Egypt unemployment rate. (2016). Retrieved from http://www.tradingeconomics.com/egypt/unemployment-rate

Transparency international. (2011). Corruption perceptions index 2011 [PDF]. Berlin.

Yearly average rates. (2016). Retrieved from http://www.usforex.com/forex-tools/historical-rate-tools/yearly-average-rates

UNDP. (2006). Human development report 2006 [PDF]. New York, NY: United Nations Development Programme.

UNDP. (2011). Human development report 2011 [PDF]. New York, NY: United Nations Development Programme.

Sector Analysis (2016)

The economy of Egypt consists of three sectors, namely the primary (agriculture, fishing, and mining), secondary (production of finished goods), and tertiary (services) sectors. According to Stiglitz (2010), six years ago, Egypts agriculture comprised 13.1% of the countrys GDP, while industry and services constituted 37.7% and 49.2% of the GDP respectively. The following is the general analysis of the Egyptian economic sectors:

1. Egypt is rich in various metals and minerals, including coal, gold, and iron ore. However, the total value of extracted and exported raw materials is not significant, and, consequently, the industry does not play a significant role in the countrys economy. However, according to Jamasmie (2016), one of the companies is currently opening a big mine, and it will be extracting significant amounts of gold by 2020.

2. In 2014, agriculture contributed to 14% of the countrys GDP, and it ranked third among Egyptian industries (Basiouny, 2014). It is primarily owned by smallholders, although the industry is not positively affected by the increasing amount of investments. However, the complicated customs procedures impose difficulties on international trade and cause numerous delays (Agriculture, 2016).

3. Although the revolution of 2011 in Egypt had a significant negative impact on the countrys industrial sector, the state is now recovering from the consequences of rebellions. Particularly, the sector has been decided to be the leading one in Egypts economy (Egypts Industrial Sector, 2016). The government created new industrial areas, carried out training, and compiled development plans. It is expected that in the near future, the sector will greatly increase the economys output.

4. Egypts tertiary sector is one of the countrys most developed ones. Particularly, the states tourism sector accounts for a large portion of the countrys GDP, and the government and private sector invest large amounts of resources into this component of the economy.

References

Basiouny, E. (2014, March). Sector analysis. Cairo, Egypt: Ministry of Foreign Affairs of Denmark.

Jamasmie, C. (2016, June 14). Egypt ancient gold mines offer clues on countrys untapped vast mineral deposits. Retrieved from http://www.mining.com/egypt-ancient-gold-mines-offer-clues-on-countrys-untapped-vast-mineral-deposits/

Oxford Business Group. (2016, February 2). Agriculture. Retrieved from https://www.oxfordbusinessgroup.com/egypt-2016/agriculture-0

Oxford Business Group. (2016, February 11). Egypts industrial sector a driver of economic activity. Retrieved December 10, 2016, from https://www.oxfordbusinessgroup.com/overview/fuelling-expansion-industry-remains-important-driver-economic-activity

Stiglitz, J. E. (2010, March 29). Egypt economic structure. Retrieved from http://www.economywatch.com/world_economy/egypt/structure-of-economy.html

Bonus Question

Compare Egypts latest (2016) figures to those of South Africa, Saudi Arabia, Tunisia, Canada, Germany, Norway, Tanzania, Singapore and Argentina (GDP, GDP per Capita, GINI, CPI). What does the comparison tell you? [in no more than a page]

Country

GDP (billion $)

GDP per Capita ($)

GINI (score/rank)

CPI (score/rank)

Egypt

331

2707

n/a for 2016

n/a for 2016

South Africa

313

7575

n/a for 2016

n/a for 2016

Saudi Arabia

646

21313

n/a for 2016

n/a for 2016

Tunisia

42.02

4235

n/a for 2016

n/a for 2016

Canada

1551

50001

n/a for 2016

n/a for 2016

Germany

3356

45270

n/a for 2016

n/a for 2016

Norway

338

89741

n/a for 2016

n/a for 2016

Tanzania

44.9

842

n/a for 2016

n/a for 2016

Singapore

293

51855

n/a for 2016

n/a for 2016

Argentina

548

12128

n/a for 2016

n/a for 2016

Comment

The analysis of the table with the data reveals several trends. First, the African countries (except for South Africa) are poorer than the other states, and they have the lowest GDP per capita among all the reviewed countries. Besides, the European countries generally have a larger GDP than the African ones.

Second, in spite of the relatively small GDP, the African countries have a relatively high GDP per capita, which could be explained by a small population because this indicator is calculated as the GDP divided by the number of people living within a state.

Third, the possession of oil deposits does not necessarily equal the highest profits. Although Saudi Arabia and Singapore have more oil than the majority of other countries on the planet, some other states, like Canada, have a higher or almost the same GDP. This means that with the proper diversification of trading, a country can reach prosperity, while the concentration on a single export product might make a state remain on the same development level. Nevertheless, the oil-trading countries still have high levels of both GDP and GDP per capita.

Fourth, the countries with a larger GDP and GDP by capita are those that are either situated on the seashore or have borders with other developed states. The reason for such a tendency is the access to the world sea trade routes and the ease of transfer of technologies and goods, which means faster trading and exporting.

Finally, the richer countries are those that did not use to be colonies of other states and retained their continental powers throughout the history. The former colonies did not have enough time to organize their economies and did not manage to become outstanding production bodies in the world economy. Consequently, now they have to act as either raw material appendages or cheap workforce sources for the more developed nations.

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