Egypt's current account deficit for fiscal year 2012/2013 decreased by 45 percent to $5.6 billion against 11.3 billion a year earlier, says a statement by the Central Bank of Egypt.

 

The bank attributed the improvement to a drop in trade deficit by 7.6 percent to $31.5 billion as exports increased alongside a higher rate of import decrease. 

 

Egyptian exports increased by 3.6 percent year to year, registering at $26 billion, while imports declined by less than 3 percent to $57.5 billion.

 

The rise of the services surplus - another component of the current account - from 19.8 percent to $6.7 billion, also eased the current account deficit.

 

It was driven by a 3.5 percent increase in tourism revenues and transportation receipts of Egyptian navigation and aviation companies. These two factors balanced the slight decrease in Suez Canal receipts and the drop in the profit transfers of foreign companies in Egypt.  

 

Overall, Egypt's balance of payment - which reflects Egypt's transactions with the external world - unfolded a surplus of $237 million against a deficit of $11.3 billion in the previous year.

 

Aid from Arab Gulf countries has enabled Egypt to avoid a balance of payments crisis thought the decrease of net inflows of foreign direct investment to the country by 25 percent to only $3 billion versus $4 billion a year earlier. 

 

The central bank stated that its net liabilities to the external world increased to US$6.5 billion from US$ 1.2 billion, mainly because of the pickup in deposits transferred from some Arab countries.