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The United States is Egypt's largest single trade partner and the second largest trading bloc after the European Union. In 2006, Egypt received 8 percent of U.S. merchandise exports to the MENA region (fifth largest), while also ranking 37 in U.S. Global exports. U.S. imports from Egypt were 2.4% of the region’s total. Egypt’s trade deficit with the United States rose from 1.1 billion in 2005 to reach $1.71 billion in 2006. However, this deficit has decreased significantly from $2.9 billion in 2001. Trade Turnover or volume (imports + exports) increased by a significant 60% in 2006 During 2006 Egypt's exports to the United States rose 14.5 percent from 2005 to approximately $2.4 billion. Total non-petroleum Egyptian exports amounted to $1.4 billion, representing 59 percent of Egypt's export structure to the United States. Implementation of the QIZ protocol, since February 16, 2005, has definitely helped increase Egypt’s exports to their current level. The QIZ protocol has encouraged Egyptian companies without any previous export experience to enter the U.S. market, particularly for those industries subject to high U.S. import tariffs in the U.S. market, mostly falling under textiles and clothing category. Around 80% of QIZ companies produce textiles and clothing articles, while only 4% are food products. Consequently, trade experts expect exports to reach $4 billion over the next four years.
On the other hand, Egyptian imports from the United States amounted to $4.1 billion in 2006, up from $3.16 billion in 2005. As an importer, Egypt’s most important imports from the U.S. are agricultural products (19%), mainly cereals, transportation equipment (21%), computer and electronic products (10%), chemicals (6%) and fabricated metal products (5%). As an exporter, the top Egyptian exports to the United States are apparel and clothing articles (34%), petroleum and products (42%), and iron and steel (14%). Exporting to the United States The customs territory of the United States consists of 50 states, along with the District of Columbia (Washington D.C.) and the U.S. administered territories of Puerto Rico and the Virgin Islands. Headquartered in Washington D.C. , the U.S. Customs Service divides its operation according to seven geographical regions. Each region is further divided into districts, with more than one port of entry (seaport or airport) per district. There are over 400 individual ports where imports enter the United States These ports are grouped into 44 port regions called districts. Many of the districts include ports in multiple states. Cargo entering the United States passes through several stages as of arrival at the port of entry up to eventual liquidation. After entry documents are fulfilled, the cargo is examined and checked for specific requirements before moving to the final stage of duty assessment. Similar procedures are applicable to goods exported to a U.S. free-trade zone. (For further details on export procedures please refer to Guide to Exporting to the U.S. Market, Business Studies & Analysis Center, American Chamber Of Commerce In Egypt.) Egypt's Exports to the United States Exports to the United States by State Egyptian exports to the United States can be monitored by Port of Entry or by District of Entry. Exports monitored by Port reflect the port where the goods are unladen off the importing vessel while exports monitored by District reflect the district where the goods clear customs, which may be different from where the goods are unladen off the importing vessel. Once the goods are unladen in the ports in any state, they may be destined for any other state in the U.S.. The Port and District data do not provide information about states of origin or destination. It is important to note that data on exports to the U.S. represent the value of goods unladen or exiting the ports in each state. Unfortunately, there are no state import statistics because it is almost impossible to know the final state(s) of destination once the goods enter the U.S. In 2006, Egyptian exports to the United States entered through 119 ports in 42 customs district. New Orleans, Louisiana received 27 percent of Egypt's total exports to the United States, followed by New York City, with 21 percent and Savannah, Georgia with a share of 16.5 percent. There are 10 districts in which Egypt managed to double its exports to in 2006. Of these only Chicago (Illinois) receives a significant portion of Egypt’s exports (2.2%), ranking ninth among all districts. Chicago’s imports from Egypt went up by almost 246% in 2006. Exports to Los Angeles (California) and New Orleans (Louisiana) grew by approximately 67% each. This is considered a significant increase as they both rank as top imports from Egypt. Other districts are also showing high growth and should not go without mentioning as they may carry a huge potential in the future. There are 23 districts which have recorded above average percentage increases in their imports from Egypt:
(For details on State-specific Egypt-U.S. trade statistics please refer to the update on Egypt-U.S. trade statistics click here) The U.S. Generalized System of Preferences (GSP) Program Under the U.S. GSP program, 93 of Egypt's export items in 2006, worth only $69.9 million or 2.9 percent of Egypt's total exports, were eligible for tariff-free entry. These included wooden and metal furniture, jams, spices, plastics, vegetables, juice, and articles of jewelry, precious metals and semi-precious stones. (Click here for exact products and values). This ranked Egypt the 25th among countries benefiting from the GSP program. This limited benefit from the program is mainly due to Egypt's specific trade structure, where approximately 76 percent of exports are textile and apparel and petroleum products that are not eligible for GSP treatment. Major Exported Commodities During 2006, Egypt's exports to the United States rose 14.5 percent from 2005 to approximately $2.4 billion. Total non-petroleum Egyptian exports amounted to $1.4 billion, representing 59 percent of Egypt's export structure to the United States. Egypt Top 20 Exports to the U.S. by 2006 Value
Source: USITC While Egypt exports to the U.S. increased by a mere 14.5% in total in 2006, several patterns are noteworthy and show potential for higher future increases. Egypt’s top 10 export performers in terms of increase in value in 2006 are mainly textiles & clothing (TC) items, in addition to iron and steel and petroleum products. Together these comprised 70% of Egypt’s export basket for that year. Among other products to be praised for impressive export performance is rice, rising for $150 thousand to almost $10 million in 2006. The majority of this went to Puerto Rico, after no rice exports for the past six years. Artificial Graphite exports, which were almost totally destined to New Orleans, should also be commended for rising from zero to $10.6 million. Egypt Top 20 Exports to the US by Increase in Value (2006)
Source: USITC Textiles and Clothing (TC) Having the only vertically integrated textiles and clothing (TC) industry in the Middle East and Northern African countries, Egypt is the only country with the availability of fibers (Egyptian Cotton), spinning industry, dyeing and finishing, apparel and home textile manufacturing industry. US quotas on TC products were removed on January 1, 2005. Very few exports of TC products (HS 50-63) are eligible for GSP program. (For a list of eligible textile products click here.) Looking further into TC export composition, products, we notice that the top 20 exported items in terms of value were:
Egypt’s TC exports under QIZ increased from $288.3 million in 2005 to $635.9 million in 2006. This increase was mainly coming from increased exports of pants, t-shirts, and shorts
Petroleum Iron and Steel
Egypt is the number one producer of steel in the Arab region and the top Middle Eastern exporter of iron and steel to the United States. Egypt's Imports from the United States Like exports, import composition shows a high degree of concentration in a few categories. The principal imports from the United States are transportation equipment, agricultural products, machinery, computer and electronic products and chemicals. This import structure reflects the present food gap in the Egyptian economy and the growing need for imported high technology equipment. Given that some of these items are tied to U.S. aid, the decline in economic assistance was expected to reflect on U.S. exports to Egypt by reducing them. What was witnessed, however, was that U.S. exports to Egypt increased by 30% in 2006 to reach $4.1 billion. Egypt Top 10 Imports from the U.S.
1. The Commodity Import Program (CIP) The CIP is one of the U.S. government's economic assistance activities in Egypt that began in 1975. The program served the public sector until 1986, with an accumulated value of transactions of $3.8 billion. The program later shifted to the private sector whereby it became known as the Private Sector Commodity Import Program (PRCIP). Since 1992, Congress has appropriated at least $200 million per year for the CIP through fiscal year 2009, despite the reduction in USAID economic assistance to Egypt that started in 1998. CIP provides U.S. Dollars at fixed exchange rates, and short to medium credit terms with an interest-free grace period, to Egyptian private sector firms to finance the importation of U.S.-manufactured commodities from the United States. The Program entails that 50% of imported merchandise be shipped on U.S. ships. The CIP program has accounted for has accounted for a cumulative total of $7.67 billion from 1975 through 2006, more than one-fourth of all economic assistance provided to Egypt. There are 35 commercial banks involved in its implementation. At its inception, CIP was instrumental in helping Egypt to reduce its sizable balance of payments deficits and in improving Egypt's negative foreign exchange position. The program also supports the government of Egypt and USAID activities and expenses in Egypt. Egyptian Imports from the United States by State Egypt’s imports come from all states in varying proportions. In 2006, Maryland topped the exporting states to Egypt providing 19.7 percent of total imports, followed by Texas with 17.3 percent and Louisiana with a share of 15.4 percent.. (For an update on Egypt-U.S. trade statistics click here) (Last Updated March 10, 2007) |
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