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Trade between Egypt and Nile Basin Countries

Economic cooperation between Egypt and African countries contributes to enhancing trade, increasing investment, accessing world markets and increasing competitiveness. Egypt is one of the 54 signatories to the African Free Trade Agreement, which provides for 90 percent tariff hikes on goods within five years of entry into force to facilitate market access across the continent. It is also a member in several regional trade organizations such as COMESA. The State has also adopted initiatives and strategies for the development of Egyptian exports to African countries. It has also established a fund to ensure investment risks in Africa. Economic cooperation between Egypt and Nile Basin countries contributes in particular to sustainable development, water and energy in particular. This article discusses the Nile Basin Initiative and the volume of Egyptian trade with these countries.

I. The Nile Basin Initiative

The Nile Basin Initiative (which includes the states on the Nile River) was signed in February 1999, aiming at strengthening regional cooperation. It is an agreement involving 10 states: Egypt, Sudan, Ethiopia, Uganda, Democratic Republic of the Congo, Burundi, Tanzania, Rwanda, Kenya and Eritrea. The agreement provides for access to sustainable development, particularly in political and social fields, through equal exploitation of the resources and capabilities of states, and includes water security.

II. Volume of trade between Egypt and Nile Basin countries

Figure 1: Volume of trade between Egypt and Nile Basin countries

Source: Data collected from the Annual Bulletin on Trade between Egypt and Nile Basin countries of the Central Agency for Public Mobilization and Statistics.

According to Figure 1, Egyptian exports to the Nile Basin increased annually to $1221.3 million in 2019 from $646.7 million in 2016, a rise of 88.9 percent in three years. It should be noted that the rise in exports was highest between 2016 and 2017, rising by 72 percent on an annual basis.

The volume of imports also increased, but at a faster pace than the increase in exports to $637.5 million in 2019 from $220.2 million in 2016, a rise of 189.5 percent. The largest rise in imports was between 2017 and 2018, rising by about 75.7 percent on an annual basis.

In addition, the trade surplus rose to $583.8 million in 2019 from $426.5 million in 2016, an increase of 36.9 percent. However, despite the high volume of Egyptian exports and imports to and from the Nile Basin, they constitute a low volume of total Egyptian exports and imports. Egyptian exports to the Nile Basin countries accounted for 4 percent of total Egyptian exports in 2019 of $30505 million, while Egyptian imports from these countries accounted for about 0.84 percent of total Egyptian imports in 2019 of $76390 million.

Figure 2: Relative distribution of Egypt’s exports to Nile Basin countries (2018-2019)

Source: The Annual Bulletin on Trade between Egypt and Nile Basin countries of the Central Agency for Public Mobilization and Statistics.

In addition, according to Figure 2, Egyptian exports to Sudan accounted for the largest percentage of Egyptian exports to the Nile Basin countries, reaching 38.1 percent of total Egyptian exports to these countries in 2019, up from 33.2 percent in 2018. It is followed by Kenya by 28.3 percent in 2019 down from 29.4 percent in 2018, and Ethiopia by 11.4 percent in 2019 down from 14 percent in 2018. However, according to data from the Monthly Bulletin of Foreign Trade submitted by the Central Agency of Public Mobilization and Statistics for December 2020, Kenya, followed by Ethiopia, were Egypt’s main trade partners in Africa in the period from January 2020, with the volume of Egyptian exports to Kenya at about $384.4 million up from about $350.2 million in January 2019, while the volume of Egyptian exports to Ethiopia at about $99.5 million in the same period was down from about $139.5 million (as shown in figure 4).

Figure 3: Relative distribution of Egypt’s imports from Nile Basin countries (2018-2019)

Source: The Annual Bulletin on Trade between Egypt and Nile Basin countries of the Central Agency for Public Mobilization and Statistics.

As for imports, Egyptian imports from Kenya are the largest proportion of total Egyptian imports from the Nile Basin countries, with 40.4 percent in 2019 of total Egyptian imports from those countries falling from 43 percent in 2018. Sudan came in second place, with 31.9 percent of imports in 2019 up from 31 percent in 2018, followed by Congo by 19.4 percent in 2019, down from 22.1 percent in 2018. However, according to the December 2020 Foreign Trade Monthly Bulletin, Egyptian imports from Kenya were about $236 million in January 2020, down from about $253 million in January-December 2019, while imports from Ethiopia were about $8.3 million in January-December 2020 down from about $26.2 million in January-December 2019.

Figure 4: Egypt’s exports to the most important Nile Basin countries

Figure 5: Egypt’s imports from the most important Nile Basin countries

Source: The Annual Bulletin on Trade between Egypt and Nile Basin countries of the Central Agency for Public Mobilization and Statistics.

It should be noted that Egyptian exports to Kenya in January-December 2020 rose during the pandemic and declined to Ethiopia. Imports from Kenya and Ethiopia declined during the pandemic, but from Ethiopia further. Moreover, the most important exports to Sudan were plastics and their manufactures, iron and its manufactures, and fertilizers. The most important exports to Kenya were paper and manufactures of paper paste, sugar and sugar manufactures, plastics and their manufactures. The most important exports to Ethiopia were aromatic oils, cosmetics, lubricants, plastics and their manufactures. The main imports from Kenya were coffee, tea, spices, paper, paper paste manufactures, fruit and edible fruits. The main imports from Sudan were cereals, oil fruits, medicinal plants, fodder, cotton and live animals. Finally, Egyptian imports from the Congo were copper and its manufactures, accounting for 99.8 percent of total Egyptian imports from the Congo in 2019.

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