Egypt Basic Data Land Area: about one million sq. Km. Egypt is considered eleventh largest among IDB member countries. Located in the Eastern North of Africa, surrounded by Mediterranean sea to the north, Red sea and Aqaba gulf to the east, Libya to the west, and Sudan to the south.

Basic Data Population: 68 million (as estimated in mid 2002). The actual population density is about 1100 because the majority are living around the Nile river (only 5% from the land area). Average annual growth rate of population is 2.1%. Life expectency at birth is 63 years. Main Towns: Cairo (Capital), Alexandria, Ismailia, Suez, and Port Said.

Basic Data Language: Arabic Measures: Metric System Currency: Egyptian Pound (LE). Annual Average Exchange Rate in 2004 is $1=LE6.5 Time: 2-3 hours ahead of GMT (Winter and Summer local mean time)

Key Economic Indicators

Nominal and Real GDP * All the years in this presentation are interval years that start July 1 and end June 30 * All numbers are in Billions of LE unless otherwise indicated

Real GDP Growth Rate & Real GDP Growth Rate Per Capita

Agriculture Trade Finance & Insurance Govrn’t Social Services Industry & Mining

Trade Finance & Insurance Industry & Mining Agriculture

Share of Private sector in Nominal GDP

Gross Domestic Product Total Uses (LE billion)

Components of Final Consumption

Domestic Savings & Investment Ratios to GDP

Real GDP and Gross domestic Investment

Annual Inflation Rate & Unemployment Rates

Fiscal Policy Indicators

Percentage of Government Debt to Nominal GDP

Nominal GDP, Govrn’t Domestic Debt, & Govrn’t Debt/GDP%

Interest & Wages

Balance of Payments and Foreign Trade Indicators

Overall Balance

Non-Oil Exports & Total Imports in US$ millions

Total External Debt & Debt types

External Private Sector Debt in US$ millions

Total External Debt to GDP & Debt Service Ratio *Debt service to total exports of goods and services

Monetary Policy Indicators

M2 Growth Rates, Annual Inflation and Nominal Interest Rates

Broad Money and Narrow Money

Annual Inflation and Nominal Interest Rate

Annual Inflation & Nominal Interest Rate

Exchange Rate

Exchange Rate and Dollarization Rate

Financial Sector in Egypt

Structure of Egyptian Banking System Central Bank of Egypt Commercial BanksBusiness & Investment BanksSpecialized Banks Public Sector Banks (4) Private & Joint Venture Banks (24) Off- Shore Banks (21) IndustrialReal Estate Agricultural Industrial Developmen t Banks Branches (883) Private & Joint Venture Banks (11) Real Estate Banks Principal Bank for Development and Agricultural Credit Branches (90) Branches (14) Branches (22) Branches (976) Branches (42) Branches (298)

1- Banking System a. Total Assets (LE Million)

b. Total Deposits (LE million)

c. Loans and Discounts (LE Million) Source: Central Bank of Egypt (CBE) Annual Report 2001/2002

Loans & Credits (Excluding Discounts) By Type

2- Stock Exchange Market

Annual Return, P/E Ratio, & Annual Volatility

Volume of Trading, Turnover Ratio, & No. of Companies Traded

Emerging Market Indicators - End December 2000 (unless otherwise stated)

3- Insurance Sector Market Structure and New Entries The Egyptian insurance market is principally composed of the Supreme Insurance Council, the EISA, the Insurance Federation of Egypt, a number of insurance companies, a specialized reinsurance company, a number of private pension funds, insurance cooperative association, the Government Insurance Fund, insurance pools, the cargo Supervision & Surveying Office of Egypt, and the Insurance Institute for Training Middle Management.

As well as one state-owned reinsurance firm (Egypt Re.) and three public sector insurance companies (Misr, Al Charq, and National), there are several private companies in Egypt: Suez Canal, Mohandes, Delta, Pharaonic (of which AIG has purchased 90%), Arab Misr Insurance Group AMIG, Alico, Egyptian American Insurance, Commercial International Life Insurance (CIL), and the Egyptian Compnay for Export Guarantee. In addition, two recently privatized companies operate in the free zone are: the Egyptian Insurance Company, and the Arab International Insurance Company. The latter recently acquired EISA’s approval to operate onshore.

The public sector represents 73.3% of the insurance market, while the private sector represents 26.7%. In line with the government’s program encouraging private sector participation. Several insurance companies have entered the Egyptian market, while many others have expressed interest (four are in the pipeline). CIL, a joint venture between UK’s Legal and General and the Commercial International Bank of Egypt (CIB), started operations in April 2000.

Two new entrants to the field of life insurance have obtained approval and are expected to begin operations soon: Al Ahram Insurance Company (in which Royal and Sun Alliance has a major stake) and the Arab International Life Insurance Company (Allianz Insurance Co.). The 600 private pension funds operating in Egypt operate mainly in the life and retirement insurance sectors. This indicates that life insurance has been marketed successfully as a group product through institutions in the private sector.

Private funds invested about LE 390 million in the capital market from their contributions, which amounted to LE 1>352 billion in 2000/01. As for companies, direct premiums (life and non- life) increased from LE2.016 billion in 1999/2000 to LE2.113 billion in 2000/01. Insurance companies invested a total of LE11.1 million in 2000/01, while pension funds invested LE8.1 million in the same year.

Total Asset amount to LE14.4 billion in 2000/01, compared to LE13.6 billion in 1999/2000 – a growth rate of 8.1%. According to EISA’s annual report, total insurance premiums represented 1% of GDP in 2000/01. in similar economies, the percentage ranges from 4 to 5%. Egypt’s insurance market therefore still has potential for growth.

The formal financial system does not play any significant role in the provision of financial support to start-ups or to existing micro-enterprises. State of the Art of Micro Finance

Micro Finance State of the Art Government OrganizationsNon-government Organizations Foreign Grants Social Development Fund Commercial Banks Government Commercial Banks Religious Institutions Local Rotating Savings Credit Associations Businessmen societies Churches Mosques (zakat)

Sources Ministry of Foreign Trade, ‘Monthly Economic Digest’, Cairo, Egypt. Central Bank of Egypt, ‘Annual Report’, various editions, Cairo, Egypt. Central Bank of Egypt,’Economic Journal’, various editions, Cairo, Egypt. Ministry of Finance, ‘Public Budget’, various editions, Cairo, Egypt.

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