Egypt’s current account deficit narrowed by 45.2% to $3.2bn during the first quarter of the fiscal year (FY) 2025/26, supported by a significant surge in remittances and growth in the services sector.
Central Bank of Egypt (CBE) data for the July-September 2025 period showed the deficit falling from $5.9bn in the same quarter a year earlier. The improvement was driven primarily by a 28.4% increase in net unrequited current transfers, which reached $10.7bn. Within this category, remittances from Egyptians working abroad rose 29.8% to $10.8bn, compared to $8.3bn in the previous year.
The services surplus also grew by 23.4% to reach $5bn. Tourism revenues climbed 13.8% to $5.5bn as tourist nights increased to 58.7 million from 51.6 million. Additionally, Suez Canal transit receipts rose 12.4% to $1.05bn, supported by an 8.6% increase in net tonnage and a 2.5% rise in transiting vessels.
The non-oil trade deficit retreated by US$ 390.2 million to stand at $9.5bn. Non-oil merchandise export proceeds grew to $9.8bn from $7.9bn, led by gold, household appliances, vegetables, fruits, and ready-made clothes. However, non-oil import payments also rose to $19.3bn from $17.7bn, driven by vehicles, spare parts, corn, polymers, and telephones.
Gains in the current account were partially offset by a wider oil trade deficit, which grew by $946.6m to reach $5.2bn. This was largely due to a $1bn increase in oil imports, totalling $6.4bn, following higher purchases of natural gas and crude oil. The investment income deficit also edged up 2.3% to $4.4bn.
The capital and financial account recorded a net outflow of $366.4m, a reversal from the $3.8bn net inflow seen in the prior year. This shift was attributed to a $5.3bn increase in banks’ foreign assets abroad.
Foreign direct investment (FDI) in Egypt registered a net inflow of $2.4bn, down slightly from $2.7bn. FDI in the oil and mineral resources sector achieved a net inflow of $9.3m, following a net outflow previously. Non-oil FDI inflows included $1.2bn in reinvested earnings, $800.8m in greenfield investments or capital increases, and $520.2m in real-estate purchases by non-residents.
Portfolio investment in Egypt saw a net inflow of $1.8bn, compared to a net outflow of $384.7m a year earlier. Medium- and long-term loans recorded a net repayment of $1bn, with principal repayments of $2bn outweighing disbursements of $965.1m.
Despite the narrowing current account deficit, the overall balance of payments (BoP) recorded a deficit of $1.6bn for the quarter, compared to a deficit of $991.2m in the same period of the previous financial year.
