Egyptians’ remittances rising, while at home economy ails

Egypt’s consistent sources of foreign currency have always revolved around the Suez Canal, tourism and expatriates’ remittances. Our government plays a minimal role in Suez Canal waterway revenues, which are mainly influenced by global trade. External and internal factors significantly affect the performance of the tourism sector, yet our government is certainly to be blamed for its inability to develop a solid tourism industry. As for remittances from Egyptians living abroad, they are anticipated to be at a record high this year, providing a surprise increase in our foreign currency revenue.

Almost a decade ago, Suez Canal revenues amounted to USD 4.7 Billion and they are presently in the vicinity of USD 5.5 Billion (per annum); yearly tourism revenues have dropped from USD 10.5 Billion to USD 7.6 Billion today. Meanwhile, according to Central Bank of Egypt reports, annual remittances that used to be USD 7.6 Billion are expected to exceed USD 26 Billion this year. Reviewing the evolution of these numbers over the past decade could easily indicate that revenues controlled by our government have dropped substantially, while the one source of revenue that is completely out of the government’s hands is growing significantly.

Remittances from abroad reflect the strong bond that Egyptians overseas have with their families at home. However, the increase in the number of overseas workers, along with the significant increase in their remittances, is a clear sign that our economy is ailing; it has not been able to expand its domestic investments and create new jobs to accommodate those overseas workers.  The overpopulation that our government has been denouncing for decades has now become our topmost source of foreign currency.

Egyptians who work abroad are either highly talented calibers that were recruited for their singular competency, or skilled laborers needed by overseas entities. Apparently, Egyptians produce a valuable output when they work in foreign nations and in entities that know how to best utilize their competence! Prior to moving abroad, these Egyptian immigrants were most likely unable to find decent jobs that could fulfill their ambitions.

Large numbers of Egyptian families are living on monthly remittances sent by a family member who holds a temporary resident work visa in an Arab Gulf country.  A large segment of our expatriate workforce is doing ordinary jobs, but a one-hundred or two-hundred US dollar bill is sufficient to boost the living standard of many poor families in Egypt considerably. There are no statistics on how remittances are spent; they are probably used to finance the daily consumption of relatives, with some opting to invest in time deposits.

Aware of their gloomy employment prospects, millions of Egyptian youngsters dream of leaving Egypt. This lays a clear responsibility on our consecutive governments that often fail to attract foreign direct investment that could accommodate our large population or to create a professional work environment that could fulfill Egyptian workers’ ambitions. Many of the jobs that Egyptians are doing abroad could be done in Egypt – if we manage to attract the overseas companies that employ them to operate in our country.

Egypt is a nation that has many distinct advantages that could yield good revenue on their own – the human element is one clear example.  However, the highest revenues are often realized when we integrate these components to produce an added-value product – and this is where our failure lies, both at the government and social level. For instance, Egypt grows an outstanding species of cotton, but we have a mediocre textile industry. Egypt possesses nearly one-third of the world’s antiquities, along with fabulous beaches, but we have a fragile tourism industry.

The brain drain that we have been confronting in Egypt for decades may be the weak link that is impeding our progress. Our flagging industries will not be revived on their own; they need a strong engine to pull them forward; that engine is our human factor, which we have been neglecting for years. Egyptians who live abroad have substantially better knowledge, experience and personal resources than those who are struggling domestically; thus, the government should encourage them to play a greater role in enabling the national transformation we desire.

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