06:43 PM
Saturday 17 September 2022
I wrote – Dina Khaled:
Media Amr Adib appeared on television during yesterday’s episode of his program “The Story” on MBC Egypt, advising citizens of the need to economize on consumption during the coming period and not to resort to buying in installments, warning them that the next is more difficult.
Amr Adib directed his speech to the Egyptians, saying: “You don’t buy anything in installments, if Arabic is expensive, you don’t buy, and basically there are no Arab women.”
And the famous journalist continued: “Next year, you will see another world. The World Bank warned of an economic recession during 2023, in the three most important economic pillars in the world, namely China, America and the European Union.”
He added: “Anything that can be complimented about, except for the economy. The dollar during the past week witnessed a rise, but slowly, and whoever remembers that what has passed is nice must know that what is frightening.”
Shall we move away from buying in installments?
Hani Genena, an economist and lecturer at the American University, supported Adeeb’s call to stay away from installment purchases, telling Masrawy that this call is intended for no one to put himself under pressure and increase obligations, while some work sectors have unstable income and may be affected by global conditions in A time when the local economy accepts austerity.
He added that some owners of non-fixed incomes may be affected by the expected stagnation in buying and selling during the coming period, but the economy will be affected by what the economic conditions are witnessing on the global scene.
Is the next economic situation “scary”?
A comprehensive new study by the World Bank revealed that the world may be heading towards an economic recession in 2023 and a series of financial crises in emerging market and developing economies will cause them permanent damage, with central banks around the world making simultaneous increases in interest rates to combat inflation.
The Federal Reserve raised interest rates for the first time in about 4 years last March by 0.25%, and by 0.5% at the May meeting, then by 0.75% in June, and then by 0.75% last July to reach the range of 2.25-2.50%.
This is the highest rate of raising the US interest rate since 1981 to curb inflation, which hit a record high in nearly 40 years, earlier this year, which coincides with raising European interest rates at an accelerating pace as well.
The Federal Reserve – the US Central Bank – will meet next Tuesday and Wednesday, September 20 and 21, to discuss the fate of interest rates, in light of expectations to raise them by 0.75%, especially after the inflation rate rose last August to a level higher than expectations at 8.3%, against expectations of a level of 8%.
The World Bank study indicates that central banks around the world have raised interest rates this year with a degree of synchrony not seen in the past five decades, a trend that is likely to continue into the coming year.
And she continued, “However, the currently expected path of increasing interest rates and other policy measures may not be sufficient to bring global inflation rates down to the levels that prevailed before the outbreak of the Corona pandemic.”
Investors expect the world’s central banks to raise basic interest rates to about 4% during 2023, which is an increase of more than two percentage points from the average interest rates in 2021.
On the local level, Hani Geneina expected that Egypt will bear the repercussions of the global economic conditions, and that the next stage will witness difficult local conditions, but it will not become to the same degree as some exaggerators portray it, but rather prices in Egypt may witness some calm during the next year.
Geneina added to Masrawy that the global economy will witness a slowdown in growth during the next year, which will of course affect the local economy and result in a slowdown in growth, which may affect some individuals with non-fixed incomes.
The growth rate of the Egyptian economy doubled during the last fiscal year compared to what it recorded in 2020-2021, despite the repercussions of the Russian war on Ukraine, and the repercussions of monetary tightening on the global and local economy, according to what was recently revealed by Dr. Hala Al-Saeed, Minister of Planning and Economic Development.
The Egyptian economy achieved a growth of 6.6% in the gross domestic product during the last fiscal year, compared to about 3.3% during the fiscal year 2020-2021, according to what the minister announced.
Egypt lowered its economic growth forecast for the current fiscal year to 5.5%, a rate lower than the 5.7% that was expected before the Russian-Ukrainian crisis.
Geneina pointed out that the local situation will go through difficult circumstances, as Egypt is on the verge of agreeing and implementing a reform program with the IMF, which calls for some austerity, which may make things seem more difficult as a result of the global crisis coinciding with austerity resulting from the reform program.
Genena believes that austerity in Egypt will be followed by some calm in prices during the new year, which may happen with what is expected to witness a decline in global commodity prices in light of the expected stagnation, and thus may reflect on the local market.
The annual inflation rate in Egypt rose for the total of the republic for the month of August, recording 15.3%, compared to 14.6% during the month of July, according to a statement from the Central Agency for Public Mobilization and Statistics on Thursday before last.
The annual inflation rate in cities also rose last August to 14.6 percent, compared to 13.6 percent in July, according to the agency’s data.
The Central Bank announced the rise in the annual core inflation rate prepared by it during the month of August to 16.7 percent, compared to 15.6 percent in July of the same year, setting a record in the last 4 years.