(Corrects company name in paragraph 11)
By Arwa Gaballa
CAIRO Feb 16 Egypt's agricultural exporters are
seeing a surge in demand and finding new foreign markets only
months after the currency was floated, with many rushing to
expand capacity to keep up.
Egypt's pound has roughly halved in value since the central
bank abandoned its peg of 8.8 to the dollar on Nov. 3, making
Egyptian fruit and vegetables look cheap and attractive to
foreign buyers, exporters said.
"Demand has doubled, with every product gaining one or two
markets," said Mostafa al-Naggari, Chairman of Fresh Fruit Co,
which recently signed deals to ship to China and is finalising
others with Australia, New Zealand and Korea.
The currency flotation helped Egypt to secure a $12 billion
IMF loan to support a wide-ranging reform programme aimed at
restoring foreign inflows and reining in the budget deficit.
A series of tax increases and subsidy cuts, along with the
currency depreciation, have driven inflation to record levels in
a country where millions live a pay cheque away from hunger. But
amid the pain of government austerity, local manufacturers and
exporters are reporting a pick up in activity.
Egyptian politicians have blamed the import-dependent
country's ballooning trade deficit, which stood at $42.64
billion in 2016, for putting pressure on the pound. Along with a
sharp reduction in imports, a rise in agricultural exports could
help narrow that gap.
Exports of Egyptian vegetables, fruits and legumes amounted
to $2.2 billion last year and would likely rise by about 15
percent in 2017 as a result of the float, Abdel Hamid
al-Demerdash, the head of Egypt's Agriculture Export Council,
The main vegetable exports include onions and artichokes,
and fruits include oranges and strawberries.
The growing interest follows a turbulent year for Egyptian
produce, with a Hepatitis A scare in North America linked to
Egyptian strawberries and a temporary ban of Egyptian fruits and
vegetables in Russia, one of Cairo's top buyers.
But traders say growth now comes down to how quickly they
can expand to meet demand.
Japan Food Solutions (JFS), a fruit and vegetable exporter,
is working to double its planted area this year to meet an
expected 20-30 percent increase in demand on the back of new
orders from markets in Europe and North America, senior managing
director Emad Said said.
"I see this as a golden opportunity for Egyptian produce to
compete more aggressively ... The clever ones will seize this
opportunity to enter new markets," he said.
PICO Modern Agriculture Co, another exporter, has seen its
demand from Gulf Arab countries jump by about 50 percent in the
last two months, chief executive Alaa Diab said.
"The flotation has been very tempting and very helpful. It
opened the eyes of many importers to come look at Egypt where
they can get much more competitive deals," Diab said.
(Editing by Eric Knecht, Lin Noueihed and David Evans)