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Viewing cable 09CAIRO1396, EGYPT'S ECONOMY: JULY 20 PRESS ROUND-UP

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Reference ID Created Released Classification Origin
09CAIRO1396 2009-07-20 13:01 2011-02-16 21:09 UNCLASSIFIED Embassy Cairo
VZCZCXYZ0006
RR RUEHWEB

DE RUEHEG #1396 2011322
ZNR UUUUU ZZH
R 201322Z JUL 09
FM AMEMBASSY CAIRO
TO RUEHC/SECSTATE WASHDC 3227
INFO RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
UNCLAS CAIRO 001396 
 
SIPDIS 
 
STATE FOR NEA/ELA 
 
E.O. 12958:  N/A 
TAGS: ECON EINV EFIN ETRD ENRG PGOV EG
SUBJECT: EGYPT'S ECONOMY: JULY 20 PRESS ROUND-UP 
 
1.(U) The following are notable economic news stories that appeared over the past week in the Egyptian press: -------------------------------------- Bank Launches Mortgage Finance Program --------------------------------------

2.(U) The National Bank of Egypt (NBE), Egypt's biggest bank, launched the largest mortgage finance program in local history. The LE10 billion (US$1.79 billion) mortgage program will target limited- and medium-income wage earners in particular. Tarek Amer, NBE Chairman, said that the bank plans to provide borrowers with 20-year loans to finance 80% of the cost of homes valued at a minimum of LE40,000 (US$7,143) and a maximum of LE3 million (US$540,000). (Al Alam Al Youm, 7/15/2009) ----------------------------------- Egypt Extends Ban on Cement Exports -----------------------------------

3.(U) Minister of Trade and Industry Rachid Mohamed Rachid announced that the Government of Egypt (GOE) has extended a ban on most cement exports to October 1, 2010, in order to deal with growing local demand, which has risen 26% in the first half of 2009 over the same period last year, and to stabilize domestic prices. Rachid stated that the GOE has extended the export ban on gray clinker and gray Portland cement, which dominate Egypt's cement export industry. The minister had previously announced in April a four-month ban on cement exports. (Al Alam Al Youm, 7/16/2009) ------------------------ Trade Deficit Decreasing ------------------------

4.(U) A recent report by the Central Agency for Public Mobilization and Statistics (CAPMAS) showed that Egypt's trade deficit decreased by 11.9% in April 2009 compared to the same month last year, from LE9,811 billion (US$1.75 billion) to LE8,647 billion (US$1.54 billion). The report also indicated that the month-to-month value of non-oil exports rose 7.9% from April 2008 to April this year, reaching LE7,512 billion (US$1.34 billion). (Al Ahram, 7/15/2009) ---------------------------------------- Oil and Natural Gas Production Increases ----------------------------------------

5.(U) A report by the Egyptian General Petroleum Corporation (EGPC) showed that production of crude oil increased 6% in FY2008/09 over FY2007/08, to 675,000 barrels per day. Natural gas production also rose to 6.4 billion cubic feet (BCF) per day compared to 6.0 BCF per day in FY2007/08. As of June 30, according to the report, Egypt's crude oil reserves were 4.4 billion barrels and natural gas reserves amounted to 77 trillion cubic feet. (Al Alam Al Youm, 7/15/2009) -------------------------------------------- GOE Releases FY2009/10 GDP Growth Objectives --------------------------------------------

6.(U) The Minister of Economic Development, Osman Mohamed Osman, announced that the GOE plans to use its economic and social development programs to boost GDP to LE1,181 billion (US$210.89 billion) in FY2009/10, with a growth rate of approximately 4%, compared to LE1,040 billion (US$185.71 billion) in FY2008/09. Osman stated that achieving this growth rate would allow the economy to counter the negative impact of the global economic slowdown and generate higher growth once the crisis has run its course, with GDP growth projected to rise to 5% in FY2010/11. Osman said that in FY2009/10 income from manufacturing, tourism and the Suez Canal is expected to grow by 3.8%, 8.7% and 8%, respectively. However, the GOE also expects unemployment to rise to 9.5% in FY2009/10. (Al Ahram, 7/14/2009) -------------------------------------------- Stock Exchange Postpones Derivatives Trading --------------------------------------------

7.(U) Mohammad Omran, Deputy Chairman of the Egyptian Stock Exchange, said that the introduction of derivatives to the Egyptian stock market would be postponed until 2011, instead of by the end of 2009 as had been planned previously. Omran attributed the delay to the global financial crisis, which has caused a decline in trading volume. (Al Ahram Al Eqtesady, 7/13/2009)