The ouster of President Mohammed Mursi may give Egypt’s economy its best chance since the2011 revolution to escape a downward spiral of currency weakness, capital flight and crumbling state finances.
The departure of Mursi, who was widely blamed for the condition of the economy, will not provide any quick or easy fixes to problems such as dangerously low foreign reserves, a ballooning budget deficit and high unemployment.
But many businessmen and economists hope for the appointment of a more technocratic administration that would address these problems methodically, while luring back some of the investors and money which have fled the country.
“I think Egypt will start taking very strong steps to strengthen the economy...I think a lot of investment will come in,” said Medhat Khalil, chairman of Raya Holding, an Egyptian information technology conglomerate.
Khalil predicted Egypt would emerge from its economic crisis in six months at most - a prediction which most foreign economists consider far too optimistic. But such optimism added about $3.2 billion to the stock market’s value on Thursday as the main share index jumped 7.3 percent.
Particularly strong were shares in companies perceived to have suffered under Mursi’s administration for political reasons, such as Ezz Steel, whose former owner was a leading official in the party of former president Hosni Mubarak.
Egyptian bond prices rose sharply and the black market exchange rate of the Egyptian pound narrowed its discount to the official rate - a sign that traders thought more funds might flow into the country.
Akram Farag, founder of Oxygen Consulting, a Cairo firm which advises on digital content, said he had been thinking about leaving Egypt but now intended to stay. Other businessmen were making the same decision, he said.
“In the short term and the long term I see what happened in Egypt last night will have a positive effect on the economy and investment.”
نستخدم ملفات الكوكيز لنسهل عليك استخدام مواقعنا الإلكترونية ونكيف المحتوى والإعلانات وفقا لمتطلباتك واحتياجاتك الخاصة، لتوفير ميزات وسائل التواصل الاجتماعية ولتحليل حركة المرور لدينا...اعرف أكثر