Egypt Freight Transport Industry Update Quarter 3 2012

  • May 2014
  • -
  • Business Monitor International
  • -
  • 90 pages

Includes 3 FREE quarterly updates

Egypt's freight transport segment has been characterised by strikes and other industrial actions in recent months, a fairly common occurrence since the ouster of President Mubarak in March 2011.These have occurred across all freight transport segments : road, rail, air and ports. BMI believes that the more commonplace these become, the bigger the impact they will begin to have on the Egypt's economy, as a fully functioning freight transport segment is essential for economic growth.
BMI is maintaining our Egypt Gross Domestic Product growth projection from last quarter of 2.1% year-on-year (y-o-y) in FY2011/12 (fiscal year running from July-June), before ticking up to 4.9% in FY2012/13. The outlook is improving, though there remain significant political tensions - not least from the Muslim Brotherhood announcing that its political wing, the Freedom and Justice Party, would be fielding a presidential candidate after all. The potential for further political unrest remains, though the election for the lower house of parliament was considered broadly successful, particularly as worst-case fears of a potential return to large-scale violent unrest alongside the one-year anniversary of the revolution in January 2012 proved unfounded.

Headline Market Data
- Air freight handled at Cairo International Airport is set to grow by 3.4% y-o-y in 2012 to reach 297,040 tonnes. Over the medium term to 2016 growth will average 3.5% per year .
- Cargo carried by rail will remain sluggish, with expansion of just under 1% to 11.99mn tonnes. - Total tonnage throughput at East Port Said is projection to grow by 6.8% to 29.76mn tonnes in 2012, and to average 11.7 % per year to 2016.
- Real growth in total trade is projection at 4.6% in 2012 and to average 8.5% in the medium term.

Key Market Trends:
Clashes Near Libyan Border In April 2012, two protesters were killed and more injured in clashes with the Egyptian military that took place near the Libyan border over increased road tolls. Road charges for commercial vehicles were increased from EGP450 to EGP600 per vehicle, and hundreds turned out to block the roads to protest.
Disruptions At Cairo Airport Cairo airport has been the scene for frequent strikes since the Arab Spring came to Egypt, eventually resulting in the ouster of President Hosni Mubarak. These appear to have subsided for now. However, the facility was struck by sandstorms in April that prevented a number of flights from landing at the airport.
These continued interruptions to cargo services at Cairo International will impact on its throughput and finances, in addition to those airlines, such as EgyptAir, which operate out of the facility.
Potential Investment By Maersk To Take Advantage Of Continued Canal Traffic Growth BMI believes that Danish shipping conglomerate AP Møller Maersk must have confidence in East-West trade through the Suez Canal if the firm 's reported plans to invest heavily in developing its transhipment hub at the waterway's mouth come to fruition.

Key Risks to Outlook
The main risks to our projections for Egypt remain to the downside. Should the country be racked by another wave of political unrest, which remains distinctly possible at this stage, volumes in Egyptian freight transport could see a contraction like that experienced at the country's ports in 2011, or across the segment when the downturn hit in 2009.

Table Of Contents

Executive Summary . 5
Industry SWOT Analysis . 7
Egypt Freight Transport Industry Environment and Risk Analysis ... 7
Egypt Political Environment and Risk Analysis 8
Egypt Economic Environment and Risk Analysis .. 9
Egypt Business Environment SWOT .. 9
Industry Trends And Developments 10
Road 10
Rail .. 10
Air 10
Maritime .. 11

Industry Analysis . 13

Market Projection ... 16

Macroeconomic Data .. 16
Air Freight ... 16
Data : Air Freight - Cairo Airport And Egypt, from 2007 to 2016 .. 17
Maritime Freight . 18
Data : Maritime Freight - Throughput, from 2009 to 2016 ('000 tonnes) 19
Rail Freight . 19
Data : Rail Freight, from 2009 to 2016 ... 20
Trade ... 20
Data : Trade Overview, from 2009 to 2016 . 21
Data : Key Trade Indicators, from 2009 to 2016 (US$mn) .. 21
Data : Egypt's Main Import Partners, from 2002 to 2009 (US$mn) 22
Data : Egypt's Main Export Partners, from 2002 to 2009 (US$mn) 22
World Oil Products Price Outlook ... 23
Data : BMI's Refined Products Projections, from 2010 to 2016 . 23
Political Outlook . 32
Domestic Politics . 32
Long-Term Political Outlook ... 33

Macroeconomic Data ... 38
Data : Egypt - Economic Activity, from 2011 to 2016 .. 40
Company Profiles ... 41
EgyptAir Cargo 41
Egyptian Transport and Commercial Services SAE (Egytrans) .. 43
Country Snapshot: Egypt Demographic Data . 45

Section I : Population ... 45
Data : Demographic Indicators, 2005-2030 45
Data : Rural/Urban Breakdown, 2005-2030 ... 46

Section II : Education And Healthcare .. 46
Data : Education, from 2002 to 2005 .. 46
Data : Vital Statistics, from 2005 to 2010 46

Section III : Labour Industry And Spending Power .. 47
Data : Employment Indicators, from 2001 to 2006 .. 47
Data : Consumer Expenditure, from 2000 to 2012 (US$) 47
Data : Average Annual Wages, from 2000 to 2012 .. 48
BMI Methodology ... 49
How We Generate Our Market Projections .. 49
Transport Market ... 49
Sources 50

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