Its not a well known fact that the Egyptian government has spent much time speaking directly to the Dubai authorities on how best to undertake its transformation. One of the key issues is how to encourage both business and tourist markets. For tourism the Red Sea Riviera is in a league of its own offering near perfect conditions for strong growth. Accessibility is excellent from the wealthy parts of the world mainly under 4.5 hours flight from most of the key Western/Eastern European, Russian and Middle Eastern states. Hot summers and warm winters and huge cultural pull have already built a thriving tourist industry centred on the main centres of Sharm El Sheik, Hurghada and the Nile.
However, to get the sort of consistent and sustainable price rises back by strong rental you need not just a strong tourism industry but a rapidly growing economy. Here Egypt is making excellent progress although there are still many challenges. Huge growth in new jobs are being created outside tourism, construction and real estate. Progress here can bee seen not just in Cairo, but also in Hurghada where new offices are being occupied by marketing, internet and media companies.
So what are the business prospects? Well I look at Egypt as a mini Dubai in the making. With no VAT, capital gains tax and just 10% tax on rental income along with very low costs of purchasing and a GDP growth in 2007 of 7.1%. It is interesting to see much of the property investment is by Egyptians themselves who are witnessing the growth in prosperity their country in enjoying.
The large growing population of 81.7m people is not with out problems with a high 20% living below the poverty line. For all the facts go to the CIA World Fact Book online:
https://www.cia.gov/library/publications/the-world-factbook/geos/eg.html
If you are in the market to see strong growth rates then Egypt should be considered but, best of all visited, to see for yourself how this country so often makes a positive impact.
If you are looking at an overseas portfolio or are looking for a quality retirement destinations, then one of the best opportunities we have in pre launch is Samra Bay, Hurghada. Samra Bay has on of the very best frontline locations, next to many existing 5 star hotels, Intercontinental, Steigenberger, Hilton and Grand Plaza. Grab yourself a 10% pre launch discount now. Contact us for more details.
Samra Bay is just one of many developments in Hurghada, El Gouna, Sahl Hasheesh and the up and coming Gamsha Bay development, that Jet2Let are marketing. We are showing investors traveling to Hurghada the best of what is on offer. Make sure you view Samra Bay soon and reserve to get the best units.
Showing posts with label Egypt GDP Growth. Show all posts
Showing posts with label Egypt GDP Growth. Show all posts
Tuesday, June 24, 2008
Why Egypt? Front line Hurghada - Samra Bay. Pre Launch Reservations
Wednesday, April 30, 2008
Egypt's credit worthiness commended by Capital Intelligence and Moody’s
Reported recently was the following story on Egypt's currency rating and reflects how this economy is likely to be grabbing more news headlines. The big reduction in government debt, and the likely economic growth around last years rate of 7.1%, adds to the positive story that Egypt is increasingly viewed as a key economy and one that will attract increasing amounts of foreign investment as domestic economic activity drives the demand for goods and services.
"Egypt’s long- and short-term foreign currency ratings have been raised to BBB-/A3. At the same time the agency has affirmed Egypt’s local currency ratings of BBB/A3.
The statement from Capital Intelligence pointed out that the change in the foreign currency rating reflects the substantial improvement in external solvency and liquidity ratios over the past few years, which indicate strong repayment capacity and an increased resilience to external shocks. CI’s expects that balance of payments trends will remain consistent with external sustainability over the medium term. Egypt’s ratings are also supported by the good progress being made on fiscal and structural reforms, which have helped to improve economic and financial fundamentals.
The statement commended the fact that the external current account recorded its sixth consecutive surplus in fiscal year 2006/2007, which ended in June, net foreign direct investment exceeded USD11billion, while official foreign exchange reserves reached USD 27.4 billion. Gross external debt continued to decline and is estimated by CI to have fallen to a comparatively low 23% of GDP or 60% of current account receipts (CARs). External vulnerability is mitigated by the country’s net creditor position, with the foreign assets of the central bank and commercial banking sector estimated by CI to exceed the external debt stock by the equivalent of 47% of CARs or 18% of GDP in June. Public external debt service is low and official reserves (excluding gold) are currently about seven times as high as the stock of short-term public external debt on a remaining maturity basis (up from four times in June 2004).
Good progress is being made in implementing the government’s economic reform program adopted in 2004. The foreign exchange market has been liberalized; customs duties reduced and trade procedures simplified; corporate and personal income taxes reformed; and tax revenue administration strengthened. The privatization process has gathered momentum: more than 40 enterprises or joint ventures were wholly or partly privatized during the past two fiscal years, the two largest of which were the Bank of Alexandria and Egypt Telecom. Efforts are also being made to strengthen macroeconomic policy frameworks and improve governance.
The statement added that improving macroeconomic management and more assertive structural reforms have contributed to acceleration in economic growth and increased employment. Real GDP increased by 6.8% in 2005/06 and by 7.1% in 2006/07 and is expected to remain above trend in the current year. The upturn in the economy and drawdown of government deposits to retire debt has led to a substantial reduction in the ratio of government debt to GDP from 103.3% in June 2005 to an estimated 78.6% in June 2007. Moody's Investors Service, one of the world’s most respected and widely utilized sources for credit ratings, also, praised positive developments in the Egyptian economy since 2004. Moody’s report said that this growth was driven by several factors including higher oil price, growth of tourism and increased exports. The past year witnessed a remarkable growth in different sectors, including sectors not related to the energy filed, which implies more jobs and more flexibility in adapting to external variables. The report expected the overall deficit of the public government to decrease in the coming years. The surplus in the balance of payments and economic growth are expected to remain the same.
Egypt's rating of susceptibility to external fluctuations went down from 42.7%to 26.6 percent in 2006 and is expected to reach 21.1 % in 2008. This reflects the economy's increased capability of absorbing external shocks especially with the huge increase of financial inflows and net international reserves.
Source: Ministry of Investment"
Subscribe to:
Posts (Atom)
